Pune-based Emcure Pharmaceuticals has pulled out its proposed initial public offer (IPO) which was to raise around Rs 300 crore besides giving part exit to Blackstone in its maiden investment in India. This follows a deal struck late last year where Blackstone sold its stake to Bain Capital for an undisclosed amount.
Bain Capital’s entry takes care of immediate capital requirements besides providing liquidity to the previous investor. Blackstone had invested Rs 226 crore in Emcure through convertible shares and held 13.09 per cent stake.
Bank of America Merrill Lynch, IDFC Capital and Morgan Stanley were managing the proposed issue.
Emcure is ranked among the top 15 pharmaceutical companies in India in terms of market share based on the domestic sales of pharmaceutical products. It is ranked much higher in the therapeutic areas in which it operates. These areas include cardiology, pain and analgesics, HIV, gynecology, nephrology, anti-infective, and vitamins, minerals and nutrients.
In April 2011, Emcure acquired Heritage Pharmaceuticals, a New Jersey-based generic pharmaceutical company, which provided it a commercial platform to market and sell its products. In December 2012, it acquired the worldwide rights of BiCNU, a branded oncology product.
For the nine months ended December 31, 2012, Emcure’s revenue from operations was Rs 1,503 crore with net profit at Rs 56.3 crore. Of these revenues, 54.7 per cent were attributable to sales within India and 45.3 per cent were attributable to sales outside the country.
Emcure becomes the first proposed IPO to be withdrawn after the election results and the fourth since January 1 this year. Interestingly, all the firms which decided not to go ahead with public floats are backed by private equity investors. These include BSCPL Infrastructure Ltd, GMR Energy Ltd and Trimax IT Infrastructure and Services Ltd.
BSCPL is an infrastructure development company which operates in road, irrigation, real estate and hydro power projects. Its proposed IPO would have also provided part exit to New Vernon Private Equity, among other investors. JM Financial and Axis Capital were the managers to the IPO.
GMR Energy decided to withdraw its proposed IPO within a month of filing draft red herring prospectus or DRHP with securities market regulator SEBI. Singapore’s sovereign wealth fund Temasek, IDFC Alternatives and Ascent Capital were looking to part exit in the IPO of GMR Energy, the power business arm of GMR Infrastructure. Bank of America Merrill Lynch, ICICI Securities, Kotak Mahindra Capital, Macquarie, Nomura, StanChart and Yes Bank were the book running lead managers to the issue.
Mumbai-based IT solutions provider Trimax, which offers systems integration, data centre and IT infrastructure management services, also sought to provide liquidity to its existing investors Aditya Birla Private Equity, Zephyr Peacock and BanyanTree Growth Capital. The firm is now evaluating options for an offshore listing. SBI Capital Markets and Anand Rathi Advisors were the book running lead managers to the issue.
(Edited by Joby Puthuparampil Johnson)