Private equity giant Advent International will acquire a 50.1% stake in Suven Pharmaceuticals from promoter Jasti family for nearly Rs 6,300 crore after it intends to merge Suven Pharmaceuticals with portfolio company Cohance Lifesciences.

Advent will also make an open offer to acquire an additional 26% stake from public shareholders as part of the deal. Advent International is buying the family’s stake at Rs 495 per share, while the public offer is yet to be finalised.

The merger of Cohance and Suven will help create a leading clinical drug development and manufacturing (CDMO) and commercial active pharmaceutical ingredient (API) provider serving the pharmaceutical and speciality chemical markets. In a stock exchange update, the pharma giant said the board would evaluate the merger, subject to regulatory and other customary approvals, considering the strategic rationale and value-add to Suven’s public shareholders.

Advent International will hold a majority stake in the pharma company upon completion of the deal. Kotak Investment Banking acted as financial advisor to Advent and Avendus Capital, while Barclays acted as financial advisor to Suven. Global private equity firm Blackstone is also believed to be interested in Suven Pharma.

Suven Pharmaceuticals, demerged from its parent company Suven Life Sciences, in 2020, has a meaningful existence in the Indian pharmaceutical CDMO space. The company has achieved a compound annual growth rate of 20% over the past four years, with an EBITDA margin of over 43%.

Cohance, wholly owned by Advent, was established in November 2022 to create a new brand identity for its CDMO and API platform and bring together three of Advent’s portfolio companies – ZCL Chemicals, RA Chem Pharma and Avra ​​Laboratories.

Cohance has two business units (CDMO and API+) and seven manufacturing plants and is expected to have a total revenue of Rs 1,280 crore for FY22.

Advent has invested in India since 2007 and committed more than $3.2 billion to 14 companies with headquarters or operations in India. Advent’s previous healthcare investments in India include Bharat Serums and Vaccines. Advent has invested over $10.4 billion in 51 healthcare companies globally.