Blackstone leads race for controlling stake in Bharat Serums
Private equity behemoth Blackstone is among a clutch of bulge-bracket global investors who are in the race to pick up a controlling stake in an Indian healthcare company, three people aware of the matter told VCCircle.
Blackstone, which struck its first hospital deal in India in 2023, and invested $1 billion to acquire Care Hospitals and KIMS Health, is likely to submit a non-binding bid by the end of this month for Bharat Serums and Vaccines Ltd. The Mumbai-based company is currently owned by private equity firm Advent International,
which is looking to exit.
In addition to Blackstone, Bain Capital, Carlyle, Partners Group, KKR, and Permira Private Equity are also showing interest in the pharmaceutical company, the people said cited above said, requesting anonymity.
Last year, VCCircle was the first to report that Bharat Serums had initiated the process to raise fresh capital and provide exit to Advent. Global investment bank Jefferies and JP Morgan are running the transaction, VCCircle had reported.
Advent is seeking a valuation of $2 billion, or ₹16,600 crore for Bharat Serums, they said. However, analysts tracking the sector said a deal may eventually be struck at $840a 900 million.
While Blackstone, Partners Group, Permira and JP Morgan declined to comment on the matter, email queries sent to Bharat Serums, Advent and other PE firms did not elicit a response till press time.
Advent had valued Bharat Serums at $500-550 million. The PE firm initially acquired about 74% in the company in late 2019 from Orbimed and Kotak Private Equity, besides partial stake from the Daftary family. Advent bought Daftary family’s remaining 26% stake in April 2022.
Bharat Serums, incorporated in 1971, is engaged in the development, manufacturing and marketing of biologicals, biotech and pharmaceutical formulations. Its product profile include plasma derivatives, fertility hormones, antitoxins, antifungals, anaesthetics, cardiovascular drugs, and diagnostic products.
The firm’s consolidated revenue rose 15% to ₹1,435.4 crore in FY23 from ₹1,245.3 crore in FY22 on the back of significant traction in the women’s health and assisted reproductive segments.
It is one of the largest manufacturers of the anti-fungal drugs Amphotret, Amphomul, Amphonex and Ampholip. In FY22, these products, used in the treatment of the black fungus infections gained significant traction amid the second wave of covid-19 pandemic. However, revenue from these drugs moderated in FY23 as covid subsided, narrowing the company’s profit margins.
However, to boost revenue, Bharat Serums acquired TTK Healthcare’s human pharma division for ₹805 crore.
Bain Capital, Carlyle, Partners, KKR, Permira Private Equity are also showing interest in the healthcare firm