NSR invests $55m in Indian pharma

New Silk Route’s investment in Nectar Lifesciences will be used to fund the expansion of the company’s generic pharmaceutical business.

New Silk Route, a private equity firm with a focus on investing in South Asia, Middle East and other emerging Asian economies, has invested INR2.52 billion (€40.3 million; $55 million) in Nectar Lifesciences, an Indian pharmaceutical company, reportedly for a 30 percent stake.

The private equity firm paid INR910 million for the acquisition of 26 million shares in the company at a price of INR35 per share, and acquired 45 million Global Depository Receipts from Nectar Lifesciences for a consideration of $35 million. Following the investment, Vivek Sett, a partner at New Silk Route, has joined the company’s board. 

Nectar Lifesciences shares were trading at INR38.95 at time of press.  

The capital injected will be deployed towards the expansion of the company’s generic pharmaceutical business, including the construction of new manufacturing plants, filing of regulatory approvals, research and development and acquisitions, the company said in a filing with the Bombay Stock Exchange.

The investment will also help the company expand its reach in the US, European and Japanese markets, Aryan Goyal, executive director of Nectar Life Sciences, said in the filing.

In January 2010, New Silk Route had agreed to acquire 26 million shares in the company, but the deal was pending shareholder approval. At the time, the company also said it would issue instruments such as global depository receipts, foreign currency convertible bonds and fully or partially convertible debentures of up to INR2.5 billion, but there was no indication that New Silk Route would invest more capital through either of these instruments. 

Nectar Lifesciences manufactures an oral range of active pharmaceutical ingredients and finished dosage forms. It exports its products to more than 45 countries across five continents. The company has 11 manufacturing facilities. 

In May 2009, New Silk Route invested INR1.35 billion for a roughly 8 percent stake in KS Oils, an Indian edible oil company. The firm’s other Indian investments include infrastructure providers Aster Infrastructure and Aster Teleservices; Destimoney, a retail financial services company; INX Media, a media and entertainment company; telecom infrastructure provider Reliance Infratel; bearing races maker Rolex Rings; and Ortel Communications, a cable and broadband access network operator and service provider. 

Founded in 2006, New Silk Route manages assets of more than $1.4 billion and has offices in Bengaluru, Dubai, Mumbai and New York.