Advent International to Acquire Controlling Stake in Avra Laboratories From Dr A V Rama Rao & Family

by Shrutee K

·         Investment builds on Advent’s expertise in the pharmaceuticals sector, having invested in over 20 businesses in pharmaceutical R&D, production, and distribution

·         Transaction is Advent’s fifth investment in India over the past 12 months

New Delhi,INDIA, January, 2022 – Advent International (“Advent”), one of the largest and most experienced global private equity investors, today announced that it has signed a definitive agreement with Dr A V Rama Rao, a distinguished scientist, Padma Bhushan and Padma Shri awardee, and his family to acquire a controlling stake in Avra Laboratories Pvt Limited (“Avra Labs”).

Founded in 1995, Avra Labs is a Hyderabad based contract manufacturing and research services (CRAMs) and specialty active pharmaceutical ingredients (API) manufacturer with four facilities across the states of Telangana and Andhra Pradesh.

Avra Laboratories is a science-driven organisation with a strong research and development (‘R&D’) team trained under the leadership of Dr A V Rama Rao, which is focused on niche generic molecules as well as proprietary custom synthesis business for global pharmaceutical players. Over a long period of time, Avra Laboratories has forged many successful partnerships with innovator companies and strongly positioned itself as a partner of choice in manufacturing complex small volume molecules. Leveraging its in-house pool of scientific talent, Avra Laboratories has a long and consistent track record of high profitability and above industry margins.

Avra Laboratories has several active process patents and is the only company in the world to develop and successfully commercialise a total synthetic process for Camptothecin analogs that are currently being used in antibody drug conjugates for targeted therapies in treating cancer.

“We are delighted to see Avra Labs join Advent’s broader API platform and are confident that the business will see sustained growth under the highly experienced leadership team. Advent’s API platform resources, R&D capabilities and global reach will help Avra Labs explore new markets and products, as well as consolidate its leadership position in existing portfolio, while continuing to deliver value to customers,” said Dr A V Rama Rao Founder and Managing Director.

“We continue to be excited about India’s pharmaceutical landscape and investing in Avra Labs will further strengthen our presence in the sector. This acquisition is an important milestone towards our goal of creating a top five merchant API Platform in India and allows Advent to be present across the spectrum of generic and patented molecules, while adding marquee innovator pharma customers,” Said Pankaj Patwari, Managing Director at Advent International India.

Advent has significant investment experience in the healthcare industry. Since 1990, the firm has invested US$10.5 billion in 52 companies in the sector worldwide. In addition to Avra Laboratories, recent pharmaceutical and healthcare investments include GS Capsule, BioDuro-Sundia, RxBenefits, RA Chem Pharma, ZCL Chemicals, Bharat Serums and Vaccines, Industria Chimica Emiliana, Vitaldent, Definitive Healthcare, Zentiva, AccentCare and Iodine Software.

Advent has been investing in India since 2007. Currently, it has invested/ committed almost $2.9 billion in 18 companies with headquarters or operations in the country. In addition to Avra Labs, new investments in the last 12 months include ZCL Chemicals Ltd (manufacturer of specialty active pharmaceutical ingredients (APIs) and advanced intermediates), Eureka Forbes Ltd (health and safety solutions provider, with a presence in water purification, vacuum cleaning and other emerging categories), Classy Kontainers (rigid plastic packaging solution supplier) and Encora (a global digital engineering services company specializing in software product development services for fast-growing enterprises and digitally-native companies).

The transaction will be subject to customary closing conditions.

Ernst and Young LLP was the sole financial advisor to the shareholders of Avra Laboratories for this transaction.

ABOUT ADVENT INTERNATIONAL: Founded in 1984, Advent International is one of the largest and most experienced global private equity investors. The firm has invested in over 380 private equity investments across 42 countries, and as of September 30, 2021, had $86 billion in assets under management. With 15 offices in 12 countries, Advent has established a globally integrated team of over 250 private equity investment professionals across North America, Europe, Latin America and Asia. The firm focuses on investments in five core sectors, including business and financial services; health care; industrial; retail, consumer and leisure; and technology. For over 35 years, Advent has been dedicated to international investing and remains committed to partnering with management teams to deliver sustained revenue and earnings growth for its portfolio companies.

ABOUT AVRA LABS:Avra Labs is a research oriented CRAMS and API manufacturer, headquartered in Hyderabad, India. The company focuses on niche proprietary molecules as well as custom synthesis and process optimisation for Innovator customers. It has one USFDA approved facility in Hyderabad as well as 3 units in Vizag. The company manufacturers APIs and advanced intermediates across therapeutic areas including Oncology, Ophthalmology and electronic chemicals.