Simultaneously, the country’s largest e-pharmacy is also undertaking secondary transactions of up to $100 million, buoyed by high interest from pre-IPO investors willing to come on board. PharmEasy is expected to be valued at approximately $6 billion after the funding round, creating a benchmark valuation prior to public listing. The last time it was worth $4.2 billion in June. The parent of the Mumbai based company, API HoldingsAs mentioned above, the board approval has also been received to convert the private firm into a public company.
“The pre-IPO funding round construction is almost final. Of the names to come on board, only the outline of the deal with BlackRock is yet to be finalized,” said one of the persons.
People familiar with the matter said the online pharmacy has been estimated to receive a valuation of $9-10 billion in public listings.
high investor interest
However, this “could be the IPO price at a valuation of $7-8 billion, so there is an uptick in valuations after the IPO for investors,” he said.
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ET reported last month that
PharmEasy aims to file its draft red herring prospectus (DRHP) by October And it is in talks to raise new capital at a $5.6 billion pre-fund valuation. “It (pharmacy) is on track with its deadline for filing prospectus with markets regulator SEBI (Securities and Exchange Board of India) next month,” a source confirmed.
The investors of PharmEasy include the founder, former managing director and chief executive of HDFC Bank Aditya Puri, which sits on the board of API and has also invested in the company’s recent funding round. He owns less than half a percent in the firm, according to regulatory documents obtained from business intelligence platform Toffler. Investment firm Tiger Global also owns a little over 1% in API Holdings.
Typically, in a secondary transaction, existing investors sell part or all of their shares to new investors and the money does not go to the company’s treasury, as opposed to primary funding, when the company is issued new shares. capital is received.
Due to interest among late stage and pre-IPO investors to get stake in tech startups ahead of their public offering, PharmEasy founders are in talks with existing investors to get them to sell some of their stakes for secondary transactions , so that new investors can be accommodated.
“Right now, talks are on for a $100 million secondary raise as the management doesn’t want to significantly reduce its holdings before the IPO,” said a person with knowledge of the matter. Second and third week of October.
Founders Hike Holdings
Meanwhile, API Holdings’ founders – Siddharth Shah, Dharmil Sheth, Dhaval Shah, Harsh Parekh and Hardik Dedhia – are investing more in the company as it prepares to go public. “They (founders) have got new incentives based on certain milestones achieved by the company. It will be around Rs 50 crore for each founder, but they are reinvesting it in the company,” said sources.
“Even the venture investors who backed PharmEasy prior to the merger with API Holdings are not inclined to dilute their stake through secondary before the IPO,” he said.
Siddharth Shah, co-founder and chief executive of PharmEasy, declined to comment on the story. Emails sent to the above mentioned investors did not elicit any response on the matter.
As of August 15, the founders hold about 10% in API Holdings, data from industry tracker Traxon showed. API Holdings had acquired Ascent Health and its subsidiary 91 Streets Media, which used to run PharmaEasy. The merged entity includes Prosus Ventures, Singapore-based Temasek, US private equity major TPG and B Capital as its investors.
new board member
E-Pharmacy on Monday
announced that it has appointed five independent directors to its board. Subramaniam Somasundaram, former chief financial officer of Titan and Ramakant Sharma, founder and chief operating officer of Livspace, are among them. The board now has 12 members.
PharmEasy also said that it plans to hire over 200 engineers for its soon-to-be-started development centers in Hyderabad, Pune and NCR. It currently has over 6,100 employees.
These moves come at a time when the company is looking to establish itself as an e-healthcare platform after the acquisition of Thyrocare in June. It is now looking to buy into the insurance sector and is ramping up its online doctor consultation offerings.
According to a recent report by Praxis Global Alliance, the Covid-19 pandemic led to rapid growth for teleconsultation in India, which had a market size of $163 million as of March. This is projected to increase to $800 million by March 2024.
EY said in a report last year that the online pharmacy market in India is projected to be worth around $2.7 billion by 2023, up from around $360 million in 2020.