American PE firm buys controlling stake in Avra Labs valued at US$100 million

INDIA –Advent International, a global private equity fund, has announced that it will acquire a controlling stake in Avra Laboratories in a deal valued at US$100 million.

Avra, founded in 1995 by Dr. AV Rama Rao and his family, has one facility in Hyderabad that has been approved by the US drug regulator, the Food and Drug Administration (FDA), as well as three units in Vizag.

Avra specializes in contract manufacturing, research, and specialty active pharmaceutical ingredients. According to a statement, both parties have signed a binding agreement for the transaction.

The statement did not provide valuation information, but officials with knowledge of the situation estimated the company founded by Padmabhushan awardee Rao and his family to be worth US$100 million.

The acquisition will help Advent International create an API platform that ranks among top five players in India.

Avra Labs manufactures APIs and advanced intermediates for oncology, ophthalmology, and electronic chemicals, among other therapeutic areas.

It focuses on a proprietary molecule niche, as well as custom synthesis and process optimization for innovator customers.

Advent’s acquisition of Avra will be the private equity firm’s fifth investment in the last 12 months, highlighting the firm’s interest in the pharmaceutical sector.

Since its inception in 2007, it has invested in over 20 Indian companies involved in pharmaceutical research and development and distribution.

Mr. Pankaj Patwari, managing director at Advent International India, expressed confidence in the acquisition, noting that it will strengthen the private equity firm’s presence in the pharmaceutical sector across a range of generic and patented molecules.

In this transaction, EY served as the sole financial advisor to Avra Labs and its shareholders.

Advent claims to have extensive investment experience in the healthcare sector. Since 1990, the company has invested more than US$10.5 billion in 52 companies in the sector around the world.

Since 2019, Advent and other private equity players have been investing in or acquiring API makers or formulations companies in India, despite rising geopolitical tensions between India and China.

Indian pharmaceutical companies rely on Chinese suppliers for roughly two-thirds of their API needs, but they have recently increased their own production, making them more appealing to investors.

Advent’s recent investments

Advent established a presence in Mumbai in 2009. It has invested or committed nearly US$29 billion in 18 companies based in India or with operations there, covering a wide range of industries including consumer goods, financial services, healthcare, industrial, and technology.

Last year, it completed a buyout of ZCL Chemicals and took part in a late-stage funding round of tech startup Zenoti.

In addition to Avra Laboratories, Advent’s recent pharmaceutical and healthcare investments include GS Capsule, BioDuro-Sundia, RXBenefits, RA Chem Pharma, Bharat Serums and Vaccines, Industria Chimica Emiliana, Definitive Healthcare, Vitaldent, Zentiva, AccentCare, and Iodine Software.

Liked this article? Sign up to receive our regular email newsletters, focused on Africa and World’s healthcare industry, directly into your inbox. SUBSCRIBE HERE

Newer Post

Thumbnail for American PE firm buys controlling stake in Avra Labs valued at US$100 million

Digital health company Akili Interactive inks US$ 1 billion SPAC deal to go public

Older Post

Thumbnail for American PE firm buys controlling stake in Avra Labs valued at US$100 million

Ugandan female legislators seek additional funds for maternal health

Be the first to leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.