Blackstone acquires 75% stake in VFS Global for $1.87 bn

By: |
October 07, 2021 7:36 PM

While EQT is massively selling down majority ownership, and the foundation a portion of its stake, they will collectively retain indirectly 25 per cent in the company that was launched in Mumbai.

blackstoneBlackstone is buying out 75 per cent equity from EQT Private Equity and Kuoni and Hugentobler Foundation.

Leading American private equity player Blackstone is acquiring a 75 per cent stake in VFS Global for USD 1.87 billion (about Rs 13,975 crore), valuing the visa services firm at USD 2.5 billion.

Blackstone is buying out 75 per cent equity from EQT Private Equity and Kuoni and Hugentobler Foundation.

While EQT is massively selling down majority ownership, and the foundation a portion of its stake, they will collectively retain indirectly 25 per cent in the company that was launched in Mumbai.

VSF, second time getting majority owned by PEs, was launched as a ‘side project’ at the luxury Swiss travel group Kuoni in 2001 by its current chief executive Zubin Karkaria in Mumbai. But then moved its headquarters to Zurich and Duabi, and the company now operates across 147 countries.

Funds managed by Blackstone Capital Partners have signed a definitive agreement on Thursday with EQT Private Equity (EQT VII fund) and the Swiss-based Kuoni and Hugentobler Foundation to acquire a majority stake in VFS Global.

EQT will remain indirectly invested in VSF with a minority position alongside us. Blackstone, as majority shareholder, and the KHF, as minority shareholder, will be co-investors after transaction, Blackstone said in a statement that did not disclose the deal value or the percentage of equity it is buying.

However, a source in the know of the development told PTI that the deal valued VSF at USD 2.5 billion and Blackstone is paying USD 1.87 billion for the 75 per cent stake it is picking up, mostly from EQT and the rest from Kouni Foundation, which will collectively retain 25 per cent equity.

VFS Global, also known as Visa Facilitation Services Global, is an outsourcing and technology services firm that serves governments and diplomatic missions worldwide by managing visa and passport issuances.

Being the global leader in the space, it services over 60 governments through 3,500 visa application centres across 140 countries and since its inception in 2001, it has successfully processed over 230 million visas.

Lionel Assant and Amit Dixit, Europe and Asia head of Blackstone, respectively, said, that VFS spearheaded the visa outsourcing business and is today the global market leader, playing a crucial role in enabling access to travel for millions around the world in an efficient and secure manner. The local market expertise, unmatched global footprint and technology leadership make it a reliable partner to client governments across the world.

Matthias Wittkowski, a partner within EQT, said we are proud of the growth that VFS has made in the past five years under our majority ownership.

Karkaria said, with Blackstone VFS is entering the next phase of growth.

Karl Hofstetter, the chairman of Kuoni and Hugentobler Foundation, said, we are confident that with Blackstone as majority shareholder, the company will realise its exceptional long-term potential.

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