Blackstone, Advent in race for stake in Suven Pharma

MUMBAI: Private equity investors Blackstone and Advent International are in separate talks with the promoters of Suven Pharmaceuticals Ltd to buy a controlling stake, two people aware of the development said.

“The sale process has been going on for a few months, and now Blackstone and Advent are in the final round of bidding for the controlling stake in Suven Pharma. The promoters are looking to sell at least half of their stake in the company, which will also trigger an open offer for 26% of the public shareholding in the company,” one of the two people said on the condition of anonymity.

Promoters, led by Venkateswarlu Jasti, own a 60% stake in Suven Pharma, which has a market value of ₹6,378 crore. The sale of at least half of their shareholding will put the deal size at more than ₹3,000 crore, followed by a 26% open offer, which, if successful, could see the eventual buyer spend an additional ₹1,600-1,700 crore.

In 2019, Suven Life Sciences demerged its contract manufacturing business into Suven Pharmaceuticals to unlock value. The company went public in March 2020.

Blackstone and Advent declined to comment on the development, while an email sent to Suven Pharmaceuticals remained unanswered.

Advent has been acquiring companies in the Indian pharma sector, but for Blackstone this is the first attempt to buy a pharma company.

“PE firms have been on a buying frenzy in the pharma sector since covid. The likes of Advent, Carlyle, PAG and KKR have acquired companies from formulations to active pharmaceutical ingredient makers and contract drug development and research companies. But Blackstone, which has made large and very successful buyout bets in other sectors, has so far stayed away from pharma. Hence, it is expected to put a very competitive bid for this asset,” the second person said.

REUTERS This is Blackstone’s first bid to buy a pharma firm.