HQ Team
December 27, 2022: Advent International, a global private equity investor, will buy a 50.1% stake in India’s Suven Pharmaceuticals for INR 63,130 million ($762 million), according to a BSE filing.
After the acquisition from the Jasti family, which owns a 60% stake, Advent may explore the merger of Suven’s portfolio company, Cohance Lifesciences, with Seven Pharmaceuticals.
The merger will “build a leading end-to-end contract development and manufacturing organization (CDMO) and merchant API player servicing the pharma and speciality chemical markets.”
Advent will also be making an open offer to acquire an additional 26% of the outstanding equity shares of the company from the public shareholders.
Cohance’s two business units, CDMO and API+, cater to development and manufacturing for pharmaceutical and speciality chemical innovators and leading global generic companies with product requirements.
Revenue growth
It has seven manufacturing facilities. Chance recorded a total revenue of more than INR 12,800 million in the fiscal ending 2022 and has grown at more than 21% CAGR organically in the last two years.
“We have built a business with industry-leading growth & margins,” Venkateswarlu Jasti, Managing Director at Suven Pharmaceuticals, said.
“We have cultivated excellent relationships with multiple global innovator companies backed by deep R&D capabilities and demonstrated track record of execution and delivery excellence. Advent is the ideal partner for us, with deep expertise in healthcare and a global network of professionals and experts,” he said.
“Their experience and resources will launch the next growth phase for Suven pharma. This move will benefit the Suven platform immensely. The proposed collaboration with Cohance is a win-win for Suven and its public shareholders. It will help us offer a broader set of services and multi-sites to our customers,” said Jasti.
Demerger
Suven Pharma, which was demerged from its parent entity, Suven Life Sciences, in 2020, is one of the leaders in the India pharma CDMO space with a growth of more than 20% CAGR over the last four years.
Suven does more than 90% of its business with innovators and follows the customer from phase 1 to commercialization. It has a strong pipeline of phase 3 and late phase 2 molecules with more than 100 active projects.
“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,” said Pankaj Patwari, managing director at Advent International.
“We will also look at acquiring synergistic businesses globally to build capabilities further and gain new customer access,” said Patwari.
Advent has been investing in India since 2007 and founded its Mumbai office in 2009. It has committed over $3.2 billion across 14 companies with headquarters or operations in India in sectors such as business and financial services, retail, consumer and leisure, healthcare, industrial and technology.
Globally, Advent has invested over $ 10.4 billion across 51 companies in healthcare.
