Kotak Fund to Invest INR 1,600 Cr in Nimmagadda Prasad's API Biz

Reportedly, to support this acquisition, KSSF is contributing $200 million in funding, a combination of structured debt and equity.

India's Kotak Mahindra Group asset management arm, Kotak Strategic Situations Fund (KSSF) has planned to invest around INR 1,600 Cr in the recently acquired active pharmaceutical ingredients (API) business by Nimmagadda Prasad, from Viatris last week.

Reportedly, to support this acquisition, KSSF is contributing $200 million in funding, a combination of structured debt and equity.

Moreover, Deutsche Bank and DBS have also financed the acquisition. However, the exact figure of the transaction could not be ascertained.

Last week, we reported that Pharma Czar Nimagadda Prasad backed IQuest Enterprises Acquired Viatris' Indian API Biz, which is part of a larger global divestiture valued at $6.94 billion. The acquisition amount is reported to be $450 million, however, the transaction is expected to close in the first quarter of 2024.

This development marks the return of Nimmagadda Prasad, popularly known as Matrix Prasad into the pharmaceutical sector after a hiatus of 17 years.

Earlier, in 2006, Prasad had divested his stake in Matrix Labs into US-based generics player Mylan, which in the year 2020, merged with Upjohn, a legacy division of Pfizer, and was renamed Viatris. The newly formed global pharma, Viatris aims to improve healthcare access and sustainably deliver high-quality medicine in their relentless pursuit.

Its major investments include AGS Transact Technologies, Sify Infinite Spaces, Gold Plus Glass Industry Ltd, logistics firm TVS Supply Chain Solutions, speciality chemicals firm DCW, cement player Sanghi Industries and Nuvoco Vistas.

Kotak Investment Advisors (KIAL), set up in 2005, has raised more than $8.7 billion across different asset classes, including private equity, real estate, infrastructure, special situations and listed strategies.

The first fund, KSSF I, has fully deployed $1 billion in 14 companies, including INR 1,070 Cr in Biocon.

In 2021, KSSF invested INR 250 Cr in Sanjaya MAriwala's Special Purpose Vehicle (SPV) to help the latter buy out two B2C supplement businesses - 'œSetu' and 'œEdence' from Omniactive Health Technologies as well as provide dry-powder for further investment in the nutraceuticals businesses.

In another development, IndiaRF acquired Ind-Swift's API, CRAMS units for INR 1,650 Cr to enhance its market presence and competitive cost position. With this initiative, the company sought to expand capacity on the back of growth from newer geographies and invest in new product development across both API and CRAMS to provide a larger portfolio of products to its customers.