TA Associates in advanced talks to buy Piramal Pharma stake

TA Associates is in advanced talks to acquire a minority stake in Indian billionaire Ajay Piramal’s pharmaceutical business, according to people familiar with the matter.

The Boston-based private equity firm is in discussions to buy about a 20% stake in Piramal Pharma, a unit of Piramal Enterprises Ltd., for as much as $500 million, the people said, asking not to be named as the information is not public. Piramal aims to reach an agreement as soon as June, one of the people said.

KKR & Co. was earlier competing with TA Associates for the stake, the people said.

No final decision has been taken on the sale and talks could be delayed or fall apart, the people said. A spokesperson for Piramal said that the proposed acquisition had not been put before its board of directors. A representative for KKR declined to comment. A representative for TA Associates did not respond to requests for comment.

Piramal Enterprises is a conglomerate with a market value of $2.6 billion whose primary business lines are financial services and pharmaceuticals. Piramal Pharma has 13 manufacturing facilities globally and a distribution network spanning over 100 countries, according to its 2018-2019 annual report. The pharma unit generated 38 billion rupees ($502 million) in revenue for the nine months ended December 2019, according to its most recent investor presentation.

Shares of Piramal Enterprises have fallen 42% year to date, while the Sensex index is down nearly 27%. The company is focusing on strengthening its balance sheet rather than pursuing growth, Chairman Ajay Piramal told Bloomberg Quint in a May interview following its quarterly results.

In January, Piramal Enterprises agreed to sell its health care data analytics business Decision Resources Group to the U.S.’s Clarivate Analytics for $950 million. The cash-and-stock deal closed in February, the company said.