Carlyle buys 20% stake in Piramal Pharma for ?3,523 crore


MUMBAI : Piramal Pharma Ltd, a subsidiary of billionaire Ajay Piramal-promoted Piramal Enterprises Ltd (PEL), on Tuesday said it has completed the sale of a 20% stake to US-based private equity giant The Carlyle Group for ?3,523.40 crore.

“CA Alchemy Investments, an affiliate of CAP V Mauritius Ltd, an investment fund managed and advised by The Carlyle Group Inc completed the stake purchase, valuing the firm at $2.78 billion with an upside component of up to $360 million depending on the company’s FY2021 performance,” said a joint statement by Piramal and Carlyle.

On 26 June, Piramal Enterprises announced the stake sale for an amount of up to $490 million ( ?3,705.8 crore). Carlyle’s actual investment amount would vary according to net debt, exchange rate and performance against the pre-agreed conditions at the time of closing of the deal, it said.

The proceeds from the sale will be used as growth capital for the group’s pharma businesses to expand existing capacities as well as to tap attractive acquisition opportunities within and outside India, Piramal said on Tuesday.

The revenue of Piramal’s pharma business for the financial year ended 31 March was ?5,419 crore, contributing 41% to the company’s overall revenue. The business delivered 41% growth in Ebitda at ?1,436 crore during FY20, at an Ebitda margin of 26%.

On 7 April, Mint first reported that the pharma businesses of the group will be demerged from PEL and combined into a new entity, 20% of which will be owned by a private equity player, while at least 25% will be owned by the public and the remainder will remain with the promoters.

Piramal Pharma includes Piramal Pharma Solutions, an end-to-end contract development and manufacturing business; Piramal Critical Care, a complex hospital generics business; Consumer Products Division, a consumer healthcare business; and Piramal’s investment in the joint venture with Allergan India, which is engaged in the business of ophthalmology and Convergence Chemicals.

News Source: livemint

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