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Hyderabad Feb. 26 Granules India Ltd has decided to rope in Ridgeback Capital Investments, a US-based focused pharma fund, as a strategic investor.

The specialised pharma fund is expected to pick up 14.95 per cent of the stake in Granules India (GIL), with an approximate investment of about $5.6 million.

The board of GIL, which met on February 25, has decided to offer about 22.11 lakh equity shares of Rs 10 each fully paid up at Rs 105.50 per share (including premium), on preferential basis to Ridgeback Capital Investment LLC, or their affiliates.

To seek the formal approval of the shareholders an extraordinary general meeting has been called for on March 21, the company informed the stock exchanges.

Promoters' stake

Post this offer, the stake of the promoters of GIL led by Mr C. Krishna Prasad, Managing Director, will come down to about 32 per cent. At present, they hold about 37 per cent.

The decision to divest a significant stake has been made to get investors who will bring value to the company, which is in the midst of a growth phase. "We are sure that Ridgeback, which is a specialised pharma fund, with investments in many drug companies, will bring value, contribute to the company's growth and be a long-term partner," Mr Krishna Prasad told Business Line.

GIL had got the EGM nod a few months ago to raise up to $20 million through FCCB, GDR, preferential offer etc. to meet the demands of the expansion project, acquisitions in the near term. The present decision to get a strategic investor is part of that move. "The company was keen to consolidate and be a long term player," he said.

GIL, which is in the niche sphere of granulation, is close to commissioning its 6 billion tablet per year capacity plant on the outskirts of Hyderabad. It recently acquired a Chinese company and another in the Netherlands.

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