The Hindu Business Line : Avesthagen to decide on IPO date in March

Hyderabad, Oct. 30 Avesthagen will be deciding on the date for entering the capital market with an IPO by next March. The Bangalore-based company wanted to raise money through IPO last year, but had deferred its plans owing to choppy market conditions.

“We are looking at raising some Rs 700-800 crore through the IPO and pre-offer placements in the first half of 2010 to fund our various expansion programmes,” Dr Villoo Morawala Patell, CMD of the company, said.

“We want the market to stabilise and investor confidence to return before entering the market. We believe that sometime in the June-July period next year, the market will stabilise,” she told newspersons at a function to unveil the new joint venture, Atash Seeds, between Avesthagen and the French international cooperative group, Limagrain, which specialises in seeds and cereal products, here. The funding will be used to commercialise 40 products which are in various stages of development, apart from expanding its manufacturing base, labs and sales and marketing.

Patents

The company, which currently holds about 560 patents, will be valued-based on its patent and product portfolios. It expects to clock a turnover of Rs 100-crore this fiscal. She said the company was ready to hit the market with its first biosimilar product in October next year. “This will be in the area of anaemia treatment,” she pointed out.

On the new joint venture, Atash Seeds, Dr Villoo said while Limagrain holds 51 per cent, Avesthagen has 49 per cent. “I am the Chairman (of the joint venture), while they (Limagrain) will appoint a CEO. We will run the company jointly. It will be the first Indian biotech company to work towards jointly contributing to the Indian and French agricultural sectors,” she said.

Licensing pact

According to the terms of the joint venture agreement, Limagrain has also entered into an exclusive worldwide licensing arrangement for developing and marketing genetically modified seeds such as maize, wheat, barley, rice and sunflower based on Avesthagen’s technologies. Avesthagen will license its patented technologies to Atash Seeds to develop, produce and market seeds nationally and globally.

Dr Villoo expects Atash to generate at least $100 million/annum in five years, for which the joint venture will need to invest between $30 and $40 million in the next three years.

Earlier, the joint venture was unveiled in the presence of the French Minister for Foreign Trade, Ms Anne-Marie Idrac, and the AP Minister for Industries, Mr K. Lakshminarayana.

Speaking on the occasion, Ms Idrac said she expected India and France to conclude the free trade agreement next year, which would further boost trade between the two countries.

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