Ascent Capital invests in drugmaker spun off from SeQuent Scientific
Photo Credit: VCCircle

Mid-market private equity firm Ascent Capital has invested in a women-focused drugmaker that was previously part of its portfolio company SeQuent Scientific Ltd.

The PE firm has put Rs 125 crore (about $17.54 million) in Naari Pharma Pvt. Ltd, the drugmaker said in a statement.

The funds will help the drugmaker enhance research and development activities, improve infrastructure and ramp up go-to-market initiatives, Naari co-founder and CEO Prithi S Kochhar said.

Noida-based Naari Pharma was originally incorporated as Indo Phyto Chemicals Pvt. Ltd in 1978. The company was renamed after SeQuent Scientific acquired a 51% stake in Indo Phyto in January 2016.

SeQuent sold its stake to Tenshi Life Sciences Pvt. Ltd—a company founded by the family office of SeQuent founder Arun Kumar—in May 2017 as part of a broader restructuring exercise.

Incidentally, SeQuent is also backed by Ascent Capital and is itself on the block.

Ascent Capital founder and CEO Raja Kumar said the investment in Naari was in line with the firm’s goal to foray into the niche pharmaceutical domain with a global market focus. “We are confident of bringing complementary skills to this partnership that will support the [Naari] team,” Kumar said.

Naari CEO Kochhar said the company aims to achieve revenue of $100 million (Rs 710 crore) within three to four years. He didn’t disclose its current revenue. Data from VCCEdge, the data platform of Mosaic Digital, showed that the company posted net sales of Rs 62.3 crore for the year through March 2018.

The company develops and makes pharmaceutical intermediates, bulk drugs and finished dosage formulations mainly for women. It makes bulk drugs at a factory located in Uttarakhand’s Nainital district and formulations at a facility in the state’s Udham Singh Nagar district.

Ascent Capital

The PE firm invests across sectors such as technology, healthcare, financial services, consumer brands, and infrastructure. It is targeting a corpus of $350 million (around Rs 2,450 crore) for its new fund.

Kumar initiated the process of gaining management control of Ascent Capital eight years ago after the PE firm was spun out from UTI Venture Funds Management Company Ltd, which is a part of UTI Asset Management Company.

The PE firm had invested about Rs 190 crore in SeQuent in 2015, according to VCCEdge. It owned a 5.7% stake in the Mumbai-listed drugmaker at the end of December, stock-exchange data showed.

Its portfolio also includes companies such as BigBasket, Acko, National Stock Exchange and CARE Ratings. In May 2017, Ascent Capital invested afresh in portfolio company Maiyas Beverages and Foods Pvt. Ltd.

In 2018, Ascent exited Newgen Software Technologies Ltd through an initial public offering. The PE firm fetched a handsome return on its investment.

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