Torrent Pharma in talks with CVC, Bain Capital to raise funds for Cipla buyout

livemint.com:

Torrent Pharmaceuticals is in talks with private equity funds CVC Capital Partners and Bain Capital. The Indian pharmaceutical is planning to raise up to $1.5 billion to bid for Cipla, reported Reuters citing sources familiar with the matter. Torrent and Blackstone are among those interested to acquire a stake in Cipla, India's third-biggest drugmaker by sales, in what could be the largest pharma deal in India ever.

Cipla's founding family is keen to sell their 33.4% holding entirely, sources say, and any bid will also trigger an open offer for another 26% stake, as per Indian regulations. That translates to a $6.75 - $7 billion deal, Bernstein estimated in an Aug. 30 report.

Torrent is likely to reach a decision to finalize its consortium financing partner in the next few days, said the first source. Bain and Blackstone declined to comment while Cipla, Torrent and CVC did not respond to comments. The Economic Times first reported CVC's talks with Torrent on Monday.

Cipla also exports medicines to North America and South Africa, and sells generic drugs to treat illnesses like cold, fever and headaches. It competes with global majors Pfizer and Abbott, among others, in the world's most populous nation whose pharmaceutical market is expected to reach $130 billion by 2030, from $50 billion currently. Torrent, whose market cap is 54% lower than Cipla's $11.9 billion, is present in more than 40 countries and sells medicines related to diabetes, pain management, gynaecology, oncology and anti-infective segments as per its website.