TA Associates scores another exit as Colorcon to buy majority stake in Ideal Cures

 TA Associates scores another exit as Colorcon to buy majority stake in Ideal Cures

Colorcon, Inc., a company in the pharmaceutical film coatings and specialty excipients business, said Thursday it has purchased a majority share in Ideal Cures Pvt. Ltd, a manufacturer of excipients and ready-to-use coating systems for solid oral dosage forms located in India.

It did not share deal details but said Ideal Cures will operate as a fully independent entity within Colorcon.

The target’s business complements Colorcon’s position in the Indian pharmaceutical market with a strong presence in the domestic generic sector. Additionally, growth of the domestic nutritional market driven by the consumer-led health and wellness trend in emerging markets is supported, targeting ayurvedic (Indian traditional medicines) and herbal supplements, it said.

Simon Tasker, CEO, Colorcon, noted: “Colorcon views this acquisition as a further opportunity to expand business in the Indian subcontinent and support the continued growth of the Indian domestic pharmaceutical and supplement markets complementing the business activity of Colorcon Asia Pvt. Ltd as it services the regulated pharmaceutical industry across India.”

Private equity firm TA Associates had picked up a large stake in Mumbai-based Ideal Cures Pvt. Ltd in 2017.

Ideal Cures was founded by Suresh Pareek in 1999. It has manufacturing plants, in Vasai, Jammu, Khambat and Sikkim.

The deal adds to the flurry of exit moves by TA Associates this year. The PE firm has five other exits in motion or executed.

The Boston-based private equity firm is planning to sell its entire stake in Tega Industries and a bulk of its holding in RateGain Travel Technologies Ltd via their initial public offerings.

The twin moves come after TA Associates signed an agreement to partially exit Atria Convergence Technologies Ltd and its portfolio company Prudent Corporate Advisory Services Ltd filed a draft prospectus for an IPO.

While TA will sell most of its stake in Atria via a secondary transaction with Swiss alternative investor Partners Group, it will divest almost half its holding in the mutual fund distribution company Prudent through the IPO. It also scored high returns from the BillDesk exit.

The flurry of exits come after a two-year gap. TA’s previous exit was in August 2019 when it sold its stake in Micromax Informatics via a share buyback and clocked tepid returns from its near decade-long investment.

TA has also previously exited Idea Cellular, Fractal Analytics and Dr Lal PathLabs. Its current portfolio includes National Stock Exchange, ‘W’ branded womenswear maker TCNS Clothing, Indira IVF, OmniActive Health, Fincare and Shilpa Medicare.

Vivek Sinha

The Capital Quest