Mumbai: Yes Bank Ltd, is setting up a Rs500 crore investment fund for India’s pharmaceutical and healthcare sectors in a 50:50 joint venture with the Netherlands’ Gilde Investment.
The fund, christened India Life Sciences Fund, will invest in small and medium pharma, health-care and biotechnology companies.
The bank is currently working on the legal structure of the fund that is expected to be operational by mid-2007, said Rana Kapoor, founder and chief executive of Yes Bank.
Funds are being raised in Europe and India, with the bulk of the money coming from Europe, where Gilde runs two life-sciences funds. While it will primarily target the institutional investors in Europe, in India, however, companies are also being asked to participate in it.
Pharma and health care, two fast growing business sectors, have already attracted several financial institutions and banks such as ICICI Bank, Citibank and Kotak Mahindra in the last couple of years.
However, the Yes Bank-Gilde effort will be the first dedicated fund focusing on these sectors. Another fund, APIDC-Venture Capital, floated as a joint venture between the Ventureast Group and the Andhra Pradesh Industrial Development Corp., is dedicated to investments in biotechnology.
ICICI Venture, the venture capital arm of India’s largest private sector bank ICICI Bank, has invested in five to six major pharma projects, including Perlican, the drug research company of Dr Reddy’s Laboratories, the Bangalore-based biotech research group Avesthagen and Ranbaxy Fine Chemicals Ltd.
Last year, Yes Bank proposed a private equity fund for food and agribusiness. This $100 million (Rs450 crore then) fund, to be operational in another three months, will invest in firms engaged in farm imports to food retailing.
These firms could be in the business of organic food, ready-to-eat food as well as other categories, said Kapoor.