Mankind Pharma & EQT-ADIA in INR 14,000 Cr Race for BSV Group

If finalized, this will be one of the largest buyouts of a domestic pharmaceutical company in India and potentially one of the most lucrative exits for a buyout fund in the sector.

Mankind Pharma has entered a fierce competition with Europe's largest buyout group EQT together with Abu Dhabi Investment Authority (ADIA) to acquire BSV Group (formerly Bharat Serum & Vaccines Ltd) for a whopping sum of INR 14,000 Cr

Earlier, DHN reported that Mankind Pharma along with Private Equity firms including TPG, Blackstone, and EQT, along with a consortium of Warburg Pincus and ChrysCapital had joined the fray to acquire BSV Group.

However, the competition has now crystallized, with Mankind Pharma and the EQT-ADIA partnership submitting firm offers earlier this week, aiming to acquire the company from its current private equity owner, Advent International, for an estimated INR 14,000 Cr ($1.6 billion).

The third contender, a consortium of Warburg Pincus, ChrysCapital, and Mubadala, evaluated the opportunity but ultimately did not submit a binding offer, despite being shortlisted from a broader pool of potential buyers.

Others who had shown initial interest included Permira, CVC Capital, Carlyle, Partners Group and even Dr Reddy's Laboratories but the high valuation expectation from Advent at 20x FY25 EBITDA, likely at INR 630-650 Cr, muted the enthusiasm of some potential buyers.

If finalized, this will be one of the largest buyouts of a domestic pharmaceutical company in India and potentially one of the most lucrative exits for a buyout fund in the sector.

A final decision is anticipated this week.

A Look into the Advent's Deal

Advent, which currently holds a 100% stake, initially acquired a 74% stake in November 2019 from Orbimed Asia and Kotak PE for $500 million. The remaining 26% was purchased in 2020 for an undisclosed amount, providing an exit for the previous promoters.

Additionally, Advent has appointed JP Morgan and Jefferies to sell the Mumbai-based biopharma firm five years after buying a controlling stake in it for INR 3,500 Cr ($500 million).

Founded in 1971 by the late Dr Vinod G Daftary, Bharat Serum and Vaccines, researches, develops, manufactures, and markets injectable biological, pharmaceutical, and biotechnology products.

The firm specializes in women’s healthcare, assisted reproductive treatment, critical care, and emergency medicines. The acquisition is anticipated to strengthen Mankind Pharma’s standing in the pharmaceutical industry.

Recently, the vaccine developer witnessed revenue growth of 15% to INR 1,435.4 Cr in FY23. The company had reported revenue of INR 1,235.3 Cr in the previous fiscal year, as per a September 2023 report from rating agency ICRA.