Personal-care products maker Emami Ltd is looking to acquire Ahmedabad-based unlisted personal care firm Paras Pharmaceuticals Ltd, Emami group director Harsh Agarwal said today.

"We are interested in acquiring Paras Pharma. Negotiations on that front haven't started yet but as and when it comes to that we will start talking," he said, but refused to comment on the price. Earlier today, Mint newspaper had suggested a figure of Rs 4,000 crore, but Agarwal declined to confirm it.

The development follows a report on Wednesday by Bloomberg that Actis Capital LLP and Sequoia Capital plan to sell a controlling stake in Paras Pharmaceuticals for $700 million. The report didn't name its sources.

Actis, a private equity firm that invests in emerging markets, holds about 62 per cent of closely-held Paras, and Sequoia, one of Google Inc and Yahoo! Inc's early investors, owns about 8 per cent. Paras chairman Girish Patel and employees own the remaining stake.

Actis declines to comment on market speculation and rumors, Ravi Shyam, an external spokesman for the London-based private equity firm, said. Raja Ganapathy, a spokesman for Sequoia in Mumbai, Claire Brough, a spokeswoman for Glaxo in the UK, and Jean-Marc Podvin, a spokesman for Paris-based Sanofi-Aventis, declined to comment. Abbott India spokesman Koustubh Kanade didn't immediately respond to a Bloomberg e-mail seeking comment.

Actis, which has $4.8 billion in assets under management, began buying stakes in Paras in 2006, and currently has an investment of about $145 million in the company, according to a statement from the buyout firm.

Paras's revenue has grown 32 per cent this year, while earnings before interest, taxes, depreciation, and amortization (EBTDA) have climbed 51 per cent, the statement from Actis said.

The company sells over-the-counter personal healthcare products including pain relieving creams, talcum powder and cold medications, according to its website.

The buyout firms decided to sell their shares after receiving interest from drugmakers including GlaxoSmithkline Plc, Sanofi-Aventis SA and Abbott Laboratories, says Bloomberg.

Emami, which manufactures personal care brands such as 'Fair and Handsome', 'Navratna Oil', 'Boroplus' and 'Sonachandi Chyawanprash', has been scouting for acquisitions in the personal care space after it acquired Zandu Pharmaceutical Works Ltd in November 2008.

As on 31 March, Emami had cash reserves of Rs604 crore, and the firm in June had passed an enabling resolution to raise Rs1,000 crore.

Paras Pharma has over-the-counter and personal care brands such as 'Moov', 'Krack', 'D Cold', 'Set Wet', amongst others.

Emami is interested in a controlling stake in the firm and not just acquiring the personal care brands of Paras, Agarwal, who handles the personal care products business for Emami, told Reuters. "Actis and Sequoia are interested in selling their stake and once the talks begin we are interested in acquiring a controlling stake," he said.

A sale would add to the $4.44 billion of Indian pharmaceutical mergers and acquisitions this year, the most since 2008's record $5.67 billion in transactions, according to data compiled by Bloomberg. The transaction may value the company, based in Ahmedabad, at $750 million to $1 billion.