Warburg Pincus In Talks To Invest Rs 1,500 Crore In MedPlus

MUMBAI, 21 DEC 2020:

Warburg Pincus is in advanced talks to invest Rs 1,500 crore in MedPlus, India’s second-largest pharmacy retailer, for a significant minority stake at a time when online and offline chains face consolidation with the entry of deep-pocketed companies such as Reliance Retail, Tata and Amazon.

Multiple people aware of the deal told ET that the money, a mix of debt and equity, will be used to pay o existing lenders such as Goldman Sachs and Edelweiss and also offer liquidity to smaller shareholders of the company. In January 2018, MedPlus raised around $115 million in debt financing from Goldman Sachs to buy out its investors, including US-based Mount Kellett Capital Management, TVS Capital Funds and Ajay Piramal’s India Venture Advisors. The three investors together held a 69% stake in MedPlus.

Later, Azim Premji's investment arm PremjiInvest picked up a minority stake for around Rs 200 crore and did a follow-on investment of around Rs 100 crore. PremjiInvest will continue to remain invested in the company with around 18% stake and may also participate in this round while Warburg will become the single largest shareholder.

MedPlus founder and CEO Madhukar Gangadi, a Wharton graduate, will continue to run the business releasing his share pledges with the investments.

The final documentation is underway and is expected to get signed this coming week.

Warburg is believed to have trumped rivals such as Temasek that were also keen to invest in the company, sources add. Economic Times