Business Daily from THE HINDU group of publications
Thursday, Jan 25, 2007
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Business Daily from THE HINDU group of publications Thursday, Jan 25, 2007 ePaper |
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Mergers & Acquisitions Web Extras - Bio-tech & Genetics Avestha Gengraine raises € 25 m from strategic partners Our Bureau
Food major Groupe Danone's arm Daninvest has invested € 4.5 million (nearly Rs 27 crore) in R&D for bio-nutritional products, in the process picking up four per cent stake in the six-year-old company founded by Dr Patell. A € 10-million input by Fidelity International gives it 10 per cent stake, while European seed major Groupe Limagrain has pumped in € 5 million (nearly Rs 30 crore) in the company, Dr Patell, who is the Vice-Chairperson and Managing Director, told a news conference. Media house Bennett, Coleman & Co is the fourth, smaller investor in the company that is developing plant-based nutritional and therapeutic products.
Fund use
The company has received a valuation of € 115 million (around Rs 667 crore) and plans to have an IPO in mid-2008. The new funds would go into expansion of its infrastructure, manufacturing and R&D units, acquisition of domestic and overseas technology companies, mainly small seed units. The third and latest round of funding amounts to a dilution of 22 per cent stake in the company. In the last fund-raising, Avesthagen opened up for investments from ICICI Ventures, Cipla, Tata Industries, Godrej Industries and French research company bioMérieux, amounting to 46 per cent, apart from Dr Patell's holding. Dr Patell said there was a large requirement of over Rs 250 crore over the next 6-9 months for its ongoing and planned expansion of facilities. The remaining amount would be bridged through bank credits.
Scaling up
An investment of Rs 100 crore would be towards scaling up biopharmaceuticals facilities; Rs 70 crore for nutritional projects; Rs 60 crore for agribusinesses and acquisitions; and Rs 15-20 crore to scale up the nutritionals subsidiary, Avestagen Good Earth. A 9-acre land has been acquired in Hyderabad's Genome Valley to set up the manufacturing unit of Good Earth, which Avesthagen acquired a couple of years ago. A new corporate headquarters is coming up at ITPL. The company has been making profits for three consecutive years, posting a Rs 18-crore turnover and operating profit of Rs 1.8 crore for 2005-06. It is expected to close the current fiscal with a turnover of Rs 35-40 crore, according to Mr J. Rajagopalan, CFO.
Starting this month, Avesthagen has been revamped into four SBUs — Biopharmaceuticals, Bionutritionals, Bioagriculture and Science Services. The last division would lead the growth.
New products, mostly nutritional ones, would be in the market later this year and the first therapeutic product would go into production in March this year and be out in mid-2008. A diagnostic foray is also planned.
Mr Bruce Murdoch, Director and head of the Science & Services unit, said the company was working on biotherapies for tuberculosis, infectious diseases, cardiovascular problems, genomic and molecular research, as well as cancer and stem cell research.
Dr Patell said the headcount would go up to 600 in 18 months, up from the current 250 people.
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