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SoftBank Group has walked away from negotiations to acquire a stake in IPO-bound PharmEasy due to disagreement over valuation. API Holdings Pvt Ltd, which owns the Indian online pharmacy chain PharmEasy, was seeking a valuation of at least $5.6 billion in a new funding round.
SoftBank was in talks with API Holdings to invest $150-200 million but a deal has not resulted, said sources close to the development.
SoftBank in early talks to invest in PharmEasy
Another source said that SoftBank was interested in the company because it had a good network, however, “the valuation that PharmEasy is seeking is too high for SoftBank for the stake in return.”
It was reported in July that PharmEasy had approached SoftBank for a stake sale after the former acquired diagnostics laboratories chain Thyrocare for $611 million.
An email query to PharmEasy remained unanswered while SoftBank declined to comment.
IPO listing
According to recent reports, PharmEasy is likely to file draft prospectus with SEBI for an IPO in October. API has commissioned JM Financial and Kotak Investment Banking for the DRHP (draft red herring prospectus) process. In May, PharmEasy acquired rival Medlife. In June, it also acquired Thyrocare. API has already integrated ‘lab tests’ on its portal.
PharmEasy was founded in 2015 by Dharmil Sheth and Dhaval Shah as a subsidiary of Ascent Health. Since its inception, it has managed to deliver in over 1,000 cities and towns covering 22,000+ pin codes.
Over the last few months, SoftBank has been scouting the Indian healthcare space for making investments. In July, BusinessLine had reported that SoftBank was in preliminary talks to acquire a stake in Apollo Hospitals Enterprise Ltd’s pharmacy arm, Apollo HealthCo, as part of the Japanese company’s focus on India’s healthcare market. But this deal has also not fructified.
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