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Tata Capital Healthcare Fund invests in Marck Biosciences; IFCI part-exits

In April 2012, Tata Capital Healthcare Fund I made a final close with commitments of Rs 320 crore.

A private equity fund, managed by Tata Capital and focused on healthcare & life sciences, has acquired a minority stake in Ahmedabad-based Marck Biosciences Ltd. The minority stake was picked up by Tata Capital Healthcare Fund I through a mix of primary and secondary share purchases, sources familiar with the development told VCCircle. However, the investment amount could not be immediately ascertained.

The deal also marks a partial exit for IFCI Venture Capital, which has invested a little over $6 million in Marck since 2008, sources said.

Tata Capital Healthcare Fund I bought some shares held by IFCI Venture Capital’s India Automotive Components Manufacturers Private Equity Fund –1.

Marck manufactures and sells pharmaceutical sterile liquid dosage across a range of 80 products, under categories like fluid therapy, ophthalmic, respiratory, injectables and critical care. These products are currently sold in 77 countries. Marck is promoted by Bhavesh Patel and his family, with the head office in Ahmedabad and manufacturing plants at Kheda (Gujarat) and Goa.

The funds from the transaction will be used by Marck to augment its current business besides adding new product lines.

E-mail queries sent to Marck MD Bhavesh Patel and a Tata Capital spokesperson regarding more details did not elicit any response till the time of filing this article.

Law firm DSK Legal advised Marck on the deal while Tata Capital Healthcare Fund was represented by Desai & Diwanji and IFCI was advised by R&A Associates. Cipher Capital was sole financial advisor on the transaction.

Tata Capital Healthcare Fund focuses on growth capital investment in companies operating in pharmaceutical space, contract research/manufacturing, healthcare services, medical devices, diagnostics and other healthcare sectors. Healthcare investments are spearheaded by Vishalakshi Chandramouli, who joined the firm from Merrill Lynch with 11 years of experience as a healthcare analyst.

Tata Capital Healthcare Fund I, which raised money from domestic investors, made a final close with commitments of Rs 320 crore in April 2012. For overseas fundraising, it has also tied up with HBM Partners, a global fund focused on life sciences.

Private equity interest in the pharmaceuticals & life sciences sector has seen an uptick recently. In 2012, there were 14 deals in the sector worth $179 million, compared to eight deals worth $116 million in 2011, according to VCCEdge, the data research platform of VCCircle.

Only last week, Japanese conglomerate Mitsui & Co Ltd closed a $70 million investment in Arch Pharmalabs, which produces pharmaceutical intermediates and active pharmaceutical ingredients (APIs). Other major investments in 2012 included ChrysCapital’s $57 million stake buy in Intas Pharmaceuticals and Fidelity Growth Partners leading a $40 million round in Aptuit Laurus, a maker of APIs.

(Edited by Sanghamitra Mandal)