A clutch of private equity funds such as Kedaara Capital, Creador, ChrysCapital and Goldman Sachs have evinced interest to acquire the 13% stake held by Tata Capital Healthcare Fund in Ujjain based Shriji Polymers.
Final bids are likely to be submitted by 31 March and the company is expected to be valued at Rs.1000 – 1200 crore, said two people aware of the development. ICICI Securities is running the mandate for Tata Capital.
Tata Capital Healthcare Fund had invested Rs.40 crore in Shriji in 2015.
Founded in 2005 by Anand Bangur and Vishnu Jajoo, Shriji Polymers is a leading plastic packaging solution provider. Its portfolio of products include high-density polyethylene (HDPE) containers, polypropylene caps and other speciality plastic products like derma bottles, tablet applicators, dosing cards and similar self-administered metered dosing devices. The company has production capacity of 2-million containers and 3-million closures per day.
Shriji’s products are supplied in US, Canada and China. Shriji’s major clients include Strides Arcolabs, Sun Pharma, Mylan, Indoco, Ipca, Wockhardt, Eisai and Lupin.
For the year ended 31 March 2019, Shriji posted revenue of Rs.305 crore and a profit of Rs.51 crore. It is learnt that promoters have no plans to dilute further stake in this round and the new investor will acquire 13% stake held by Tata Capital in Shriji.
Spokespersons with Shriji, Goldman Sachs and ChrysCapital declined to comment while mails sent to Visalakshi Chandramouli, partner – Tata Capital Healthcare Fund, Creador and Keddara Capital did not elicit any responses.
Tata Capital Healthcare Fund, the healthcare-focussed private equity arm of financial services firm Tata Capital Ltd, raised Rs.320 crore in 2013 and made around 8 investments till date. It had plans to raise its second fund worth $200 million, which didn’t materialise yet.
Portfolios of Tata Capital Healthcare Fund include Intas Biopharmaceuticals Ltd, Novalead Pharma, Amanta Healthcare Limited, Sandor Nephro Services, Lokmanya Hospitals, Sai Lifesciences Limited, Brinton Pharmaceuticals and Konverge Healthcare.
Recently, Tata Capital has decided to wind down its private equity growth fund Tata Opportunities Fund, which had raised $600 million and invested in Tata Group companies such as Tata Sky, Tata Projects, Ginger Hotels, and other investments such as TVS Supply Chain Solutions, Uber and Shriram Properties.
The homegrown PE fund Kedaara Capital which manages funds worth $1.5 billion, had exposure to the packaging industry with its investment in Manjushree Technopack, India’s largest rigid plastic packaging solution provider. The portfolio was sold to US based PE fund Advent International in 2018, valuing the company at Rs.2300 crore.
Kuala Lumpur based private equity firm Creador has also exposure in Indian pharmaceuticals space through its investment in Corona Remedies, Gujarat based drug formulation manufacturer.
In one of the largest deals in packaging space, global fund Blackstone had agreed to invest $460 million to acquire a majority stake in speciality packaging company Essel Propack that manufactures laminated plastic tubes catering to the fast-moving consumer goods (FMCG) and pharma space last year. Essel Propack was part of the Subhash Chandra-led Essel (Zee) Group.
The packaging industry in India is expected to touch $73 million in 2020 from $32 billion in FY 2015.
Source: Economic Times