On Monday, private equity investor Advent International confirmed it had reached a definitive agreement to acquire a substantial stake in Suven Pharmaceuticals.

Advent intends to explore the combination of its portfolio companies, Cohance Lifesciences and Suven, to build an end-to-end CDMO and merchant API

In an exchange filing, the private equity firm said it serves the pharmaceutical and speciality chemicals markets.

As part of the transaction, Advent will also make a public offer to acquire an additional 26% of the company’s outstanding equity from the public.

“Advent is an ideal partner for us with deep healthcare expertise and a global network of professionals and experts. Their experience and resources will unlock the next phase of growth for Suven Pharmaceuticals. This move will benefit the Suven platform. Collaboration with Cohance The proposed collaboration is a win-win for Suven and its public shareholders, Suven Pharmaceuticals Ltd managing director Venkateswarlu Jasti said in a statement. This will help us provide our customers with a wider range of services and multi-site services.”

Suven Pharma, which was demerged from its parent company Suven Life Sciences, in 2020, is a significant player in India’s pharmaceutical CDMO space, with an average growth rate of over 20% over the past four years and an operating margin of over 43%. Suven’s 90% of business is with innovators and follows clients from phase one to commercialisation. It has a robust Phase 3 and Phase 2 late-stage molecular pipeline with more than 100 active programmes.

Cohance Lifesciences, wholly owned by Advent, was formed in November 2022 to create a new brand identity for its CDMO and API platform to bring together Advent’s three portfolio companies – RA Chem Pharma, ZCL Chemicals and Avra ​​Laboratories together. It has seven manufacturing plants. Cohance’s projected total revenue of Rs 1,280 crore in 2021-22, the compound annual growth rate of the past two years, is more than 21%.

Advent has invested in India since 2007 and opened a Mumbai office in 2009. It has invested or committed more than $3.2 billion in 14 companies headquartered or operating in India across business and financial services, retail, consumer and leisure, healthcare, industrials and technology. Previous healthcare investments in India also included Bharat serums and vaccines. Advent has invested more than $10.4 billion in 51 healthcare companies globally.

Kotak Investment Banking and Avendus Capital advised Advent on the transaction, while Suven has Barclays as its exclusive financial advisor.