The pandemic has turned out to be a period of mega deals in the digital healthcare space, with the latest alliance bringing together companies behind popular brands PharmEasy and Thyrocare.
API Holdings, the parent company of PharmEasy, said it had agreed to pick up 66.1 per cent stake in Thyrocare Technologies from its founder A Velumani for ₹4,546 crore (about ₹1,300 per share).
This would be the first ever acquisition of a listed company (Thyrocare), by an Indian unicorn, they said. It is the third big-ticket transaction involving an e-pharmacy company — Tata Digital Ltd acquired a majority stake in 1MG Technologies; Reliance Industries invested ₹620 crore in Chennai-based Netmeds, and late last month, PharmEasy announced the acquisition of Medlife. “When it rains it pours,” is how the companies announced this deal, that was struck in “record time” at Velumani’s residence in “monsoon-drenched Lonavala” and over a cup of “masala chai”. The meeting involved 32-year-old Siddharth Shah, Co-founder & CEO of API Holdings and 62-year-old Dr Velumani.
Shah told BusinessLine the company would raise funds through existing and soon-to-be private investors (about seven of them, including Temasek and TPG) in API. The digital healthcare space they operate in, as of today, is over ₹40,000 crore, he said. On whether Thyrocare would be delisted or API listed, he said, all options were on the table.
The transaction is through Docon Technologies Pvt Ltd, a 100 per cent subsidiary of API, which will make an open offer for the additional 26 per cent stake at ₹1,300 a share.
Seperately, Velumani will acquire a minority non-controlling stake of less than 5 per cent in API. “My exit will be a motivation to many,” he told BusinessLine , adding that “it was important to know when to exit and how.” Having come to Mumbai with ₹500 and exiting close to ₹5,000 crore, he said, “the zeros don't matter any more.” The combined entity will have the ability to provide diagnostics and pharmacy services to 100 million in 24 hours.