Japanese company Mitsui & Co Ltd is set to acquire 5% stake in major pharmaceuticals ingredient manufacturer, Arch Pharmalabs Limited. Mitsui has entered into an agreement with Arch Pharmalabs to acquire newly subscribed shares of approximately 5% of Arch at around Rs 65 crore.
Arch Pharmalabs, one of the leading chemical intermediate and active pharmaceuticals ingredient (API) manufacturers, is currently supplying its products to numerous leading multinational pharmaceutical companies based in the US, Europe and the Middle East, for drugs indicated for hypertension, hyperlipidemia, antibiotics and cancer amongst others. Arch Pharmalabs Limited has revenue of approximately Rs 1,186 crore as on March 2010.
Post-Mitsui's allotment, the promoter group will hold 34.27% in Arch Pharma, PE fund holds 43.28%, Mitsui 5.25% and others 17.2%. ICICI Venture invested in Arch Pharma through its India Advantage Fund Series I and II while other investors include South Asian Regional Apex Fund, a VC fund managed by IL&FS Investment Managers Ltd and Swiss Technology Venture Capital Fund, managed by BTS Investment Advisors Pvt. Ltd.
Through this investment, Mitsui intends to strengthen the contract manufacturing organization business platform. Further this investment illustrates Mitsui's recognition of India as having a huge potential for manufacturing pharmaceutical chemical intermediates and APIs and the growing market demand in the Asia Pacific region, said a statement from Mitsui.