Online startup PharmEasy to acquire 66% stake in dignostics chain Thyrocare for Rs4,500 cr
28 Jun 2021
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API Holdings, the parent company of online healthcare startup PharmEasy, has reached an agreement to acquire 66.1 per cent stake in listed diagnostics chain Thyrocare for a little over Rs4,500 crore. The combined entity would offer diagnostics and pharma services to 100 million people every day.
The transaction is subject to regulatory and other customary approvals. The acquisition is being made through Docon Technologies, a 100 per cent subsidiary of API, which will make an open offer for an additional 26 per cent stake for over $241 million, the startup stated in a release.
Separately, Dr A Velumani, a promoter of Thyrocare, will be separately acquiring a minority non-controlling stake of less than five per cent in API as part of a series of equity investments by existing and new investors of API.
?Pharmeasy? was founded by Dharmil Sheth, Dhaval Shah, Harsh Parekh, Hardik Dedhia, and Siddharth Shah. The company has an online pharmacy and diagnostics brand, RetailIO – a B2B pharma marketplace and seller, and DocOn – a consultation and EMR platform with a network of 6,000+ digital consultation clinics, and 90,000+ partner retailers across the country with a customer base of 12 million.
It currently serves over one million patients for their pharmacy and diagnostics needs and conducts 300,000 consultations on a monthly basis.
On the other hand, ?Thyrocare? is one of the leading diagnostics solution provider by volume, performing over 110 million tests annually. The 26-year-old firm also operates a network of over 3,330 collection centers in 2,000+ towns in India.
In a filing with the Mumbai Stock Exchange, Thyrocare has disclosed that API Holdings intends to raise another financing round, where it may sell about 4.9 per cent stake to Dr A Velumani, a promoter of Thyrocare, for about $202 million. This will imply a valuation of over $4 billion for the startup.
"The collaboration between PharmEasy and Thyrocare is unique and transformative for the Indian healthcare sector, consumers and the entire healthcare ecosystem. The synergies of both, India’s largest digital health platform and one of the largest, cost-effective diagnostics solution providers (by volume) will reimagine and accelerate the delivery of high-quality diagnostic and OPD services across the full continuum of patient care to nearly 800 million Indians." the statement adds.
“I am excited about this relationship, unique of its kind in Indian healthcare industry. The unique reach and strength of Thyrocare in diagnostics, blended with young and dynamic team of PharmEasy, will bring in better healthcare solutions for common man nationwide,” Dr A Velumani, chairman and MD of Thyrocare, said.
The six-year-old PharmEasy, which has raised about $572 million to date and was valued at $1.5 billion in its most recent financing round in April, counts Prosus Ventures, Temasek, Eight Roads Ventures, TPG, B Capital Group, and Bessemer Venture Partners among its investors.
Siddharth Shah, chief executive of API Holdings, said on Friday that the startup is in talks to raise another $500 million at $4 billion valuation.
The proposed acquisition will enable PharmEasy to serve a patient across their entire journey in a treatment, said Shah. The startup has no plans to go public immediately, he said.
“We are delighted to be partnering Thyrocare. We will provide world class customer experience in diagnostics, rivalling our pharmacy experience by leveraging technology, and building on top of the massive scale & truly pan-India presence of Thyrocare. It is our aim to deliver all outpatient healthcare products and services to every Indian within 24 hours,” said 32-year-old Shah in a statement.
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