Tuesday, December 27, 2022

PE company Advent would invest Rs. 6,313 crore to acquire 50% of Suven Pharma

PE firm Advent to buy 50% in Suven Pharma for Rs 6,313 crore

 MUMBAI: A 50 will be purchased by Advent International, a global private equity firm. a one percent equity stake in Hyderabad-based Suven Pharmaceuticals purchased from the Jasti family for approximately Rs 6,313 crore (approximately $762 million). One of the largest pharma deals in recent memory would result from this.

Sun Pharma's $4 acquisition of Ranbaxy, a major player in the domestic market, is one of the sector's most significant deals to date. 1 billion, and Piramal Healthcare was sold to multinational company Abbott for more than $3. 7 billion in 2010, as shown in the graph. The Suven scrip lost 5 as a result of the news. 2% to Rs. 472 by the end of Monday's BSE trading.

A company statement stated that following the acquisition, Advent plans to combine Suven with its portfolio company Cohance Lifesciences to create an all-encompassing CDMO (contract development and manufacturing organization) serving the pharmaceutical and specialty chemical markets. There will only be 9 members of the promoter Jasti family. 9% stake in the company if the deal is completed. Jasti Property and Equity Holdings, the promoters, currently hold a 60% stake.

Advent will launch an open offer for an additional 26% at Rs 495 per share, subject to regulatory approval of the transaction. Advent would be required to pay an additional Rs 3,276 crore if the open offer is fully subscribed, bringing the total deal value to approximately Rs 9,589 crore.

“We are delighted to welcome Advent as a strategic investor to Suven Pharma. Suven pharma will begin the next phase of growth with their expertise and resources. Suven and its public shareholders stand to benefit from the proposed collaboration with Cohance. According to Venkateswarlu Jasti, MD at Suven Pharmaceuticals, "it will assist us in offering a broader range of services."

The consolidation will be assessed by the board, thinking about the essential reasoning and accretiveness to Suven's public investors. Additionally, it will require regulatory approvals and other typical approvals.

With high growth (over 20% compound annual growth rate, or CAGR, for the past four years) and profitability (more than 43% margin in terms of earnings before interest, taxes, depreciation, and amortization, or ebitda), Suven Pharma, which was demerged from its parent company, Suven Life Sciences, in 2020, is one of the leaders in the domestic pharma CDMO space.

According to Advent International's MD, Pankaj Patwari, "Our vision for Suven is to build a $1-billion global leader by executing effectively on the product pipeline, building new marquee customers, turbo-charging business development, and scaling up manufacturing and R&D."

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