Proparco, a French development financial institution, has invested $12.5 million (Rs 70 crore) for a 20 per cent stake in Strides Arcolab Ltd’s African front-end arm. The deal values the African operations of Strides Arcolab at nearly $60 million.
The funds will be used to create additional manufacturing infrastructure in key markets in Africa, as per a BSE filing.
“Africa is the most attractive business opportunity of tomorrow. The creation of additional manufacturing infrastructure will also provide large employment opportunities and economic growth to all associated with the Strides’ African business,” said Sinhue Noronha, CEO, Strides, Africa operations.
In the last four years, Strides with a team of over 200 people, a portfolio of more than 700 products and five subsidiaries, has grown its revenue from $10 million to $27 million. The firm manufactures and markets a wide range of lifesaving antibiotics, lifestyle diseases-related curatives and nutrition/relief providing formulations.
Strides, which operates in the branded generics and OTC generic segments, has a foot print in 23 sub-Saharan African countries, excluding South Africa. Its first African manufacturing plant, located at Lagos, Nigeria, has been operational for the last four years.
In April, Strides Arcolab acquired Star Drugs’ Sterile formulations plant for $23.8 million. In January, the firm sold its Australia formulations biz to US-based Watson Pharma for $393 million.
Established in 1977, Proparco is a private equity arm of Agence Francaise de Developpement, providing growth capital to companies in emerging and developing countries. The firm offers loans, equity, guarantees and financial engineering to financial, infrastructure and productive sectors. It also offers advisory services, which are complementary to its range of financial instruments.
In June this year, Proparco SA alonwith two other companies Mount Kellett Capital Management and International Finance Corporation (IFC), entered into a definitive agreement to invest $50 million (Rs 278 crore) in New Delhi-based Educomp Solutions Ltd at a price of Rs 149.16 per share through a preferential issue. In March, the company invested $5 million along with Lok Capital II in IFMR Rural Channels and Services Pvt Ltd. In 2010, the company had disbursed around $2.7 billion for 70 projects in 28 countries.
(Edited by Prem Udayabhanu)
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