By 27 February, 2012

OrbiMed Advisors, one of the world’s largest healthcare-dedicated investment firms, is acquiring close to 12 per cent stake in midsize drug-maker Shasun Pharmaceuticals Ltd by investing Rs 50 crore ($10 million).

Proceeds from the issue would be used to part finance the ongoing capital expenditure plans of the company for FY13, which includes building a new manufacturing facility in Vizag.

The investment is done through a preferential allotment where Caduceus Asia Mauritius Ltd, an investment arm of OrbiMed Advisors LLC, is subscribing to around 6.5 million shares of Shasun at a price of Rs 76 per share, the company has disclosed in a statement to the Bombay Stock Exchange.

This would translate into an equity stake of around 12 per cent post-dilution, according to VCCircle estimates.

Malabar Capital was the advisor to Shasun on the transaction.

Incorporated in 1976, Chennai-based Shasun Pharmaceuticals (formerly Shasun Chemicals and Drugs Ltd) manufactures and sells active pharmaceutical ingredients (APIs), intermediates and related products. The company has strategic marketing arrangements with Glenmark and Alpharma.

Shasun employs more than 1400 people in India, the UK and the USA, and operates its API facilities at Cuddalore and Pondicherry in South India and Dudley in the UK.

Shares of Shasun Pharmaceuticals crashed 9 per cent to close at Rs 80.05 a unit on Monday in a weak Mumbai market.

OrbiMed manages a series of venture capital and public equity investment funds, and has assets under management of over $6 billion globally.

This is OrbiMed’s third investment in India. Two years ago, it had invested a similar amount in bio-pharmaceutical company Bharat Serums and Vaccines Ltd and prior to that, it had put in an undisclosed amount in Bangalore-based Ecron Acunova, according to VCCEdge, the financial research platform of VCCircle.

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