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Tata Capital PE fund to invest in Biocon subsidiary
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Biopharmaceuticals company Biocon Ltd has attracted another private equity firm to invest in its biosimilar unit just months after getting True North on board.

Biocon Ltd said on Friday that a private equity fund managed by Tata Capital Ltd will invest Rs 225 crore ($30 million) in its biosimilar business.

Tata Capital Growth Fund will get a 0.85% stake in Biocon Biologics India Ltd, the company said in a stock-exchange filing.

The deal values Biocon Biologics at an equity valuation of Rs 26,250 crore (about $3.5 billion) and an enterprise valuation of Rs 30,400 crore ($4 billion).

After the completion of this transaction, Biocon will hold a 95.25% stake in Biocon Biologics.

Christiane Hamacher, CEO of Biocon Biologics, said that through investments in research and development (R&D) and manufacturing infrastructure the biosimilar unit is confident of achieving a target revenue of $1 billion in the year ending 31 March 2022.

The transaction is subject to approvals.

Earlier in January, Biocon said that True North will invest Rs 536.25 crore ($74.84 million) in Biocon Biologics. The deal had valued Biocon Biologics at Rs 21,450 crore ($3 billion) on a pre-money equity basis.

Biocon, which was listed on the stock exchanges in 2004, has been incubating businesses within its fold. It divested its enzymes business in 2007 and subsequently listed its research services business Syngene in 2015.

In its annual report 2019, Biocon said it is consolidating the development, manufacturing and commercialisation operations of its biosimilars business under Biocon Biologics with its own dedicated management. It appointed Hamacher as CEO of Biocon Biologics earlier in 2019.

Biocon Biologics has a product pipeline of 28 molecules including 11 with Mylan, a few with Sandoz and rest on its own.

In September last year, Biocon acquired a Chennai-based R&D facility from Pfizer Healthcare India Ltd through Biocon Biologics.

Tata Capital Growth Fund

Tata Capital Growth Fund focuses on urbanisation, discrete manufacturing and strategic services. It typically invests between $10 million and $ 35 million per transaction.

In the pharma space, the fund had previously invested in Sai Life Sciences. The fund along with another Tata Capital fund recorded their best-ever returns after selling their stakes in the company to TPG in 2018.

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