PAG, partners buy controlling stake in Optimus for Rs 2,000 crore

PAG, a leading alternative investment firm focused on Asia-Pacific, along with consortium partners CX Partners and Samara Capital, on Wednesday said they have reached an agreement to acquire a controlling stake in Hyderabad-based pharmaceutical firm Optimus Drugs.

The financial details of the deal were not disclosed.

Sources told ET that Optimus was valued at over Rs 2000 crores.

Optimus Drugs is a vertically integrated manufacturer of pharmaceutical products including advanced intermediates, active pharmaceutical ingredients (APIs) and finished drugs.

The company was founded in 2004 by D. Srinivas Reddy, exports more than 100 drug products to 40 countries.



The deal marks the second acquisition by the consortium’s API platform, Sekhmet Pharmaventures, which aims to develop a best-in-class hub for the development and production of bulk drug ingredients.

In 2020, the consortium acquired control of Chennai-based API manufacturer Anjan Drugs Pvt. Ltd.

The businesses of the two companies are highly complementary and will provide a solid foundation for the platform to make further acquisitions, PAG said.

PAG views India as a particularly attractive market.

As of December 31, 2021, PAG has invested over $580 million in private equity deals in India, including the 2021 acquisition of Acme Formulation Pvt. Ltd, a leading contract development and manufacturing outsourcing (CDMO) company with a focus on complex pharmaceutical products.

“We are very pleased to be partnering with Dr. Reddy, Optimus Drugs and its employees to help them become one of the leading API players globally," said Nikhil Srivastava, partner and managing director, head of India Private Equity for PAG.

"Optimus is a clear leader in R&D, manufacturing, and intellectual property management. We’re looking forward to continuing their mission to deliver high quality, affordable health products across the globe,” he added.

"The combined experience of PAG, CX Partners and Samara will help Optimus become a leading player in the global API industry, and further our mission of ensuring better health outcomes for all," Reddy, Optimus founder and managing director said.

Jayendra Shah acted as transaction advisor, N.A. Shah Advisory Services LLP acted as financial and tax advisors and Khaitan & Co. acted as legal advisors to the promoters in the transaction. For the PAG-led consortium, AZB acted as legal advisors and Citadel Management Consulting, a Hyderabad-based advisory firm, acted as financial advisor.