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Singapore’s GIC comes as anchor investor in Syngene; IPO fully covered on day 2

28 July, 2015

Singapore’s GIC, one of the most active sovereign wealth funds in the country, is among the anchor investors which have together invested Rs 150 core in Syngene International Ltd, the research and development subsidiary of Indian biopharmaceutical major Biocon Ltd, as part of an initial public offer (IPO) of the company.

Syngene allocated 6 million equity shares at a price of Rs 250 a piece, the upper end of the IPO price band of Rs 240-250 a share, to around a dozen anchor investors.

GIC put in Rs 25 crore while others such as funds managed by Goldman Sachs, Morgan Stanley and Deutsche Bank besides other foreign portfolio investors and a few domestic mutual funds invested the balance Rs 125 crore.

Meanwhile, the public issue, in which Biocon is selling 22 million equity shares (including anchor allotment portion) through an offer-for-sale comprising 10 per cent of the company, opened for subscription on July 27 and was subscribed 33 per cent at the end of day 1.

The public issue was fully covered at the end of day 2.

Institutional and retail investors had oversubscribed to their portion of the issue. HNIs and corporates were not too enthused over the IPO as yet and had applied for just about a sixth of the portion reserved for them.

The issue will close on July 29.

Biocon had announced in January this year that it would list Syngene by selling up to 15 per cent of the unit through the public offer. Since the entire issue comprises an offer-for-sale, Syngene would not receive any money and the entire amount will go to its parent.

In September 2014, mid-market private equity firm India Value Fund Advisors (IVFA) picked 10 per cent stake in Syngene for Rs 380 crore, valuing it at Rs 3,800 crore.

It bought the stake from Biocon Research Ltd, a wholly owned subsidiary of Biocon, through purchase of existing shares held by BRL. Post the completion of the transaction, Biocon and BRL jointly hold 85.54 per cent stake in Syngene.

The PE firm is sitting on an unrealised gain of 45 per cent on its under one-year-old investment at the upper end of the issue price band.

IVFA had previously invested in Biocon in May 2003 and later exited in 2004, soon after the company went public and got listed.

Syngene is a contract research organisation (CRO), offering a suite of integrated, end-to-end discovery and development services for novel molecular entities (NMEs) across industrial sectors, including pharmaceutical, biotechnology, agrochemicals, consumer health, animal health, cosmetic and nutrition companies.

Axis Capital, Credit Suisse Securities and Jefferies India are the bankers for the proposed IPO.


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Singapore’s GIC comes as anchor investor in Syngene; IPO fully covered on day 2

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