Sai Life: Sai Life looking to ride bull run on D-St, avoid PE route

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Mumbai: A continuing public market rally despite high stock valuations has made the promoters of Hyderabad-based Sai Life Sciences explore an initial public offering as an alternative to their original plan of roping in a private equity investor, people in the know said.

A public listing would also give an exit route to existing financial investors including TPG Capital, the people said. The sole contender for the stake, Bain Capital, also has been re-evaluating its plan, especially due to the $800 million to $1 billion (₹6,500-8,300 crore) valuation that the promoters, the Kanumuri family, have been expecting for the pharmaceutical contract research, development and manufacturing organisation, they said.

Bain is still engaged in discussions with the promoters, but the IPO option is gathering momentum, the people said.

Agencies

The company’s financial performance has been volatile and its targets for fiscal 2024 are likely to be missed, making it difficult to match the original demand by the company, the people said.

Emails sent to TPG, Sai Life and Bain Capital did not elicit any responses till press time Monday.

A handful of investors including Advent, Apax Partners, Ontario Teachers’ Pension Plan and KKR had submitted first round bids in the range of $500-700 million to acquire the company. Bain was the last, and is the only remaining, candidate in fray.About half a dozen global funds have evinced interest in acquiring Sai Life Sciences, ET had reported in September.Investment bank Jefferies is running the sale process.

At present, PE investor TPG Capital holds about a 43.3% stake in Sai Life, while Swiss-healthcare fund HBM Private Equity India owns another 6%. The Kanumuri family owns the rest of the stake.

TPG took the stake in 2018 with a $135 million (about ₹900 crore at the time) investment.

Sai Life is an integrated contract research & manufacturing services provider, and offers drug discovery, development, and manufacturing services to leading global pharmaceuticals and biotechnology companies.

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