Carlyle to buy 20% stake in Piramal Pharma in $2.8 billion deal

IN A $2.8-BILLION deal, Piramal Enterprises (PEL)will be selling 20% stake in Piramal Pharma, which has been made a 100% subsidiary of PEL housing its pharmaceutical businesses, to affiliated entities of The Carlyle Group, the company announced on Saturday. CA Clover Intermediate II Investments, an affiliated entity of CAP V Mauritius, an
an investment fund managed and advised by affiliated entities of The Carlyle Group, has agreed to invest fresh equity capital for a 20% stake in Piramal Pharma.

The transaction, which is one of the largest private equity deals in the Indian pharmaceutical industry, values the pharma business at an enterprise value of $2.8 billion and will have an upside component that could take the EV
to $3.1 billion depending on the company’s FY21 performance.

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Equity value as on March 31 for 20% stake in Piramal Pharma would be about $490 million, or Rs  3,700 crore. The final amount of equity investment will depend on the net debt, exchange rate and performance against the pre-agreed conditions at the time of closing of the deal.

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