Mumbai: Private equity giants Advent International and Carlyle Group are firing binding offers this week to buy a minority stake in Mankind Pharma, valuing the company closer to Rs 23,000 crore, or $3.5 billion, people directly aware of the matter said.
Medical representative turned entrepreneur Ramesh Juneja-founded Mankind — with a heavy focus on selling affordable drugs in the semi-urban and rural markets — is seen as one of the better placed companies to weather an affordable generics push by the government. Last year, the New Delhi-based company, the fifth-largest in organised pharma retail, mandated Moelis & Co to advise on a minority share sale with an asking valuation of about $4 billion.
Advent, advised by JM Financial, is facing off Carlyle Group in the last lap to buy around 15% stake valued at $500-600 million. Both Advent and Carlyle have been chasing deal opportunities with Indian pharma companies in recent years. TOI reported in October last year that a clutch private equity firms were interested in buying into the 25-year-old Mankind Pharma, which has annualised revenue of about Rs 5,000 crore and an operating profit of Rs 1,000 crore.
Warburg Pincus and Apax Partners are among the other investors who pursued deal-making in Mankind with a portfolio spread across prescribed drugs, over-the-counter and FMCG products.
The Juneja family owns an 89% stake in Mankind. Capital International holds the remaining 11%. Mankind’s largest brand is Manforce with a Rs 205-crore revenue, while antibiotic drugs Moxikind CV with Rs 180 crore and Candiforce with Rs 116 crore follow next. Its other top brands are cardiac (Amlokind AT) and diabetes (Glimestar) drugs. The brand portfolio includes Manforce condoms, contraceptive pill Unwanted72, pregnancy test kit PregaNews, artificial sweetener Kaloree 1 and anti-bacterial balm Heel-O-Kind.
Mankind differentiates itself with affordable pricing and a ‘deep sales force’ strategy which faces both growth possibilities and challenges once the current government’s genericisation move — as part of affordable healthcare plan — kicks in. The company’s domestic sales stood at Rs 4,248 crore, giving it a market share of 3.7%.
When contacted, Advent, Carlyle and JM Financial declined to comment. Text messages and calls to company officials and Moelis went unanswered.
