Fidelity to buy 12-14% stake in Avesthagen
Fidelity Investments is in advanced talks to buy 12-14% stake in the Bangalore-based biotech firm Avesthagen for $10-12 million.
By Sonali Krishna, TNN |
MUMBAI: Fidelity Investments is in advanced talks to buy 12-14% stake in the Bangalore-based biotech firm Avesthagen for $10-12 million. The Bangalore-based company is currently scouting the market for investors and looking to raise capital up to Rs 120-180 crore, as a pre-cursor before it enters the capital market in 2008.
Sources revealed that the deal is likely to be closed within the next four weeks. Avesthagen has already raised up to $5-7 million with Indian corporate majors such as the Tata Group, Godrej and ICICI having invested in the company. An Avesthagen spokesperson declined comment on the issue.
The fund infusion will be used for the company’s proposed 55 patent filings. The biotech firm is valued at $107 million on a current turnover of Rs 11 crore. Daninvest.com, a wholly-owned subsidiary of Groupe Danone, had earlier purchased 5% in Avesthagen for $8 million. With the current ongoing tussle between the Wadia group and the French food giant Groupe Danone, the Bombay High Court on Tuesday ordered a status quo after hearing the Wadia group’s petition seeking surrender of shares bought by Danone in Avesthagen.
The Bangalore-based biotech company is also in the process of acquiring two domestic seed companies to deploy technology that it has developed in the agri-biotechnology business. The capital expansion is also being done to set up manufacturing facilities to upscale production, before moving into phase two of research and development.
Last year, the company decided to expand its scope of ongoing biotherapeutics development programme along with pharma major Cipla to include innovative next generation drugs catering to oncology and cardiovascular segments.
Avesthagen currently operates in biopharmaceuticals, nutraceuticals, agri-biotechnology and science innovation. The domestic biopharmaceutical business estimated at $200 million is expected to grow to about $3.3 billion by 2007-08, dominated by recombinant proteins, vaccines and monoclonal antibodies.
Sources revealed that the deal is likely to be closed within the next four weeks. Avesthagen has already raised up to $5-7 million with Indian corporate majors such as the Tata Group, Godrej and ICICI having invested in the company. An Avesthagen spokesperson declined comment on the issue.
The fund infusion will be used for the company’s proposed 55 patent filings. The biotech firm is valued at $107 million on a current turnover of Rs 11 crore. Daninvest.com, a wholly-owned subsidiary of Groupe Danone, had earlier purchased 5% in Avesthagen for $8 million. With the current ongoing tussle between the Wadia group and the French food giant Groupe Danone, the Bombay High Court on Tuesday ordered a status quo after hearing the Wadia group’s petition seeking surrender of shares bought by Danone in Avesthagen.
The Bangalore-based biotech company is also in the process of acquiring two domestic seed companies to deploy technology that it has developed in the agri-biotechnology business. The capital expansion is also being done to set up manufacturing facilities to upscale production, before moving into phase two of research and development.
Last year, the company decided to expand its scope of ongoing biotherapeutics development programme along with pharma major Cipla to include innovative next generation drugs catering to oncology and cardiovascular segments.
Avesthagen currently operates in biopharmaceuticals, nutraceuticals, agri-biotechnology and science innovation. The domestic biopharmaceutical business estimated at $200 million is expected to grow to about $3.3 billion by 2007-08, dominated by recombinant proteins, vaccines and monoclonal antibodies.
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