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Carlyle exits Claris Lifesciences with around 2x in nine years

By TEAM VCC

  • 20 Apr 2015
Carlyle exits Claris Lifesciences with around 2x in nine years

Private equity investor Carlyle has exited its nine-year-old investment in pharmaceutical firm Claris Lifesciences Ltd by selling its entire 11.29 per cent stake for Rs 170 crore ($27 million) on Monday.

It sold its stake through a secondary market transaction, completing its exit.

Last year, it had part-exited the firm by participating in the company’s buyback offer.

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Carlyle, through First Carlyle Ventures III, had invested $20 million (Rs 90 crore then) in Claris Lifesciences in March 2006, through preferential shares. It had stayed put when the company floated its IPO in 2010.

The Ahmedabad-based pharma company raised Rs 300 crore through the public issue. While originally it had fixed the price band at Rs 278-293 per share, it had to cut it down to Rs 228-235 per share and also extend the closing date for the issue after it did not find ready takers for the issue.

Claris made a poor debut, listing 1.6 per cent below issue price.

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Carlyle had encashed Rs 24 crore last year in the buyback which also saw a few other PE investors sell shares of the firm. With the latest share sale, it has pocketed a little over 2x in local currency terms while in dollar terms its investment value has appreciated by a modest 65 per cent over a relatively long nine-year period.

In 2012, Claris sold majority stake in its infusion business in India and other emerging markets by forming a three-party joint venture with Japan’s Otsuka Pharmaceuticals Factory and Mitsui & Co. The public-listed pharma company sold 80 per cent in the business for Rs 1,050 crore ($194 million) while retaining 20 per cent stake. At the time of the transaction, the company had said that it will use a part of the amount to buy back shares from the market.

It had used that money for the buyback last year.

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Claris Lifesciences stock crashed 11.2 per cent on Monday to close at Rs 274.4 a share on the BSE in a weak Mumbai market.

(Edited by Joby Puthuparampil Johnson)

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