KKR to buy 54% controlling stake in JB Chemicals

KKR will acquire the stake from the founding Mody family at a price of $9.97 per share and make an open offer for an additional 26 percent stake in the company.

Global investment firm KKR will buy a 54 per cent equity stake in Mumbai based drug manufacturer JB Chemicals and Pharmaceuticals for $415 million.

KKR will make the investment through its subsidiaries, Tau Investments Holdings Pte. Ltd., Tau Holdco Pte. Ltd., and KKR Asia III Fund Investments Pte. The private equity will acquire the stake from the founding Mody family at a price of $9.97 per share and make an open offer for an additional 26 percent stake in the company.

If fully subscribed, KKR will end up paying $616 million for 80 per cent of the company, making it arguably the largest PE buyout in Indian pharma sector. However, the private equity firm is reportedly not keen to own more than 65 per cent of the company and will accordingly adjust the stake form the promoters depending on the success of the open offer, which would then translate to a $500 million for the fund.

Post the transaction, the promoter group will be left with 17.01% of the voting share capital.