Having moved on from its original plan of inducting a private equity investor as part of a sale process, TPG-backed Sai Life Sciences has now picked four investment banks as advisors as the firm looks to launch a mega initial public offer in FY25, multiple industry sources in the know told Moneycontrol.
"After holding IPO pitches recently with investment bankers, Sai Life Sciences has engaged Kotak Mahindra Capital, Jefferies, IIFL Capital and Morgan Stanley. It is likely to be a combination of primary and secondary issue of shares and TPG and the other investors will get a window for a partial exit," one of the persons above said.
In 2018, TPG Capital invested around $135 million in Sai Life Sciences and the firm currently holds a 43.4 percent stake. HBM Private Equity India holds six percent while the balance is held by the founder family/promoter group.
A second person told Moneycontrol that the Hyderabad-based contract research, development and manufacturing organisation (CRDMO) was looking to raise between Rs 5,000 crore to Rs 5,500 crore via the proposed listing.
The closest listed proxy to Sai Life Sciences is Syngene, this person added. The firm's share price has risen by 23. 21 percent in the last year.
"Attractive valuations via a public listing amid the ongoing market buoyancy have prompted the move. The deal should be kicked off shortly," a third person shared.
A fourth person confirmed the above plans.
All the four persons above spoke to Moneycontrol on the condition of anonymity.
TPG declined to comment in response to an email query from Moneycontrol.
Moneycontrol is awaiting a response from Sai Life Sciences and will update this article once we hear from the firm. The investment banks couldn't be reached for an immediate comment.
Before switching to the listing route, Sai Life Sciences had explored the sale of a controlling stake in the firm and had conducted a sale process, which resulted in Bain Capital emerging as the front-runner in the final leg, according to a January 25 report by Moneycontrol.
The proposed transaction is expected to value Sai Life Sciences at around $800 million, in one of the biggest deals in the niche segment, the Moneycontrol report had added. But the talks with Bain Capital did not proceed further and the deal did not fructify.
A closer look at Sai Life Sciences
According to its website, Sai Life Sciences works with over 300 global innovator pharma and biotech companies to accelerate the discovery, development, and commercialisation of their NCE (new chemical entity) small molecule programmes. The firm has over 3,000 employees across its facilities in India, the UK, the US, and Japan. It is led by Chairman Dr K Ranga Raju and MD & CEO Krishna Kanumuri.
Incidentally, TPG Growth (the mid-market and growth equity investment platform of TPG) has a CDMO (contract development and manufacturing organisation) firm in its India portfolio, namely Stelis Biopharma, which recently sold its biologics facility to Syngene.
Deal activity in the CRDMO/CDMO space
Private equity players have been at the centre of M&A action in the CRDMO and CDMO space in India in recent years.
In December 2022, private equity investor Advent International entered into a definitive agreement to acquire a significant stake in Suven Pharmaceuticals.
Later, Suven announced a scheme of amalgamation to merge with Cohance Lifesciences, another portfolio company of Advent, on February 29, 2024.
On February 7, Moneycontrol was the first to report that leading global private equity fund Advent International had initiated the merger process for its portfolio companies Suven Pharmaceuticals and Cohance Lifesciences and picked Kotak Mahindra Capital and Citi as advisors for deal aspects like swap ratio, due diligence and fairness opinion.
In May 2021, Wall Street powerhouse Goldman Sachs acquired the minority stake held by homegrown private equity firm ChrysCapital and other existing shareholders in GVK Biosciences (now called Aragen Life Sciences), according to an official announcement by the top contract research player.
Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
