Blackstone may end deal with Hyderabad co

HYDERABAD: The much-awaited $275-million deal between the global private investment and advisory firm Blackstone and Hyderabad-based Ushodaya Enterprises seems to have hit a dead end. Unable to clear the hurdles in getting all the required approvals for investing in the media group, Blackstone is on the verge of scrapping the deal.
In fact, sources said, the deal has already been scrapped after a meeting between the representatives of Blackstone and Ushodaya in Hyderabad on Wednesday.However, the officials from Blackstone and Ushodaya were not available for confirmation. But, both the groups are learnt to have been renegotiating on downsizing the quantum of investment and taking the investment proposal forward without having to approach the Cabinet Committee on Economic Affairs (CCEA).
Blackstone announced its decision to invest in the leading media group, which owns the largest selling Telugu news daily Eenadu, in January 2007. With this investment, the private equity major was to acquire 26% in Ushodaya. However, the investment proposal was pending with the Foreign Investment Promotion Board (FIPB) for sometime now. The option of reducing the quantum of investment to less than Rs 600 crore would help Ushodaya in getting the funding support from Blackstone, the source said.