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Blackstone closes first deal in India

The Blackstone Group is investing $50m in Emcure, an Indian pharmaceutical company, a year after setting up in Mumbai.

The Blackstone Group has entered into its first transaction in India via a $50 million investment in Emcure Pharmaceuticals Limited. Neither Blackstone nor Emcure disclosed the size of the equity stake Blackstone will be taking in return for its investment.

Headquartered in Pune, Emcure manufactures active pharmaceutical ingredients – the raw material for drugs – in addition to branded formulations and biotech products. The drug maker which markets its products in India and overseas last year posted a turnover of $150 million, a figure projected to reach $200 million figure for the 2006-2007 financial year, a spokesman from Emcure said.

India’s pharmaceutical industry is attracting significant interest from private equity at the moment.

East West Capital Partners, a group with offices in Bangalore and Singapore, is raising a $200 million Asian healthcare fund and has identified India as a key market for it.

3LOGi, a group based in Hyderabad is also raising capital for the sector. Sponsored by Evolvence Capital in Dubai, the group is marketing a fund with a $150 million target to invest in significant minority stakes in mid-sized pharmaceutical, bio-technology and contract research and manufacturing businesses in India.

International private equity groups are also investing in the country. In March, The Carlyle Group invested $20 million in the expansion of Claris Lifesciences, an Indian drug maker, the first time Carlyle invested in Asian pharmaceuticals.

Blackstone set up its Indian private equity operations in May 2005 with the installation of Akhil Gupta as the head of the Mumbai office. Gupta was formerly the chief executive officer of corporate development at Reliance Industries, a large Indian private corporation. The firm has earmarked $1 billion for investment in the country.