NEW DELHI: India Resurgence Fund, promoted by Piramal Enterprises and Bain Capital Credit, along with its associates on Monday announced an investment of up to ₹992 crore in drug firm Panacea Biotec.
"The investment proceeds will be used for a one-time settlement with existing lenders, general working capital and growth requirements of the company," IndiaRF and Panacea Biotec said in a joint statement.
This investment is structured by way of non-convertible debentures (NCDs) of up to ₹864 crore and subscription amount of ₹32 crore towards share warrants to be allotted on a preferential basis, it added.
The subscription amount represents 25% of total amount of ₹128 crore proposed to be raised upon issuance of equity shares against warrants as per Sebi regulations, 2018, the statement said. Subject to exercise of warrants, IndiaRF along with its affiliates will collectively end up owning 10.4% stake in the company on a fully diluted basis, it added.
Commenting on the development, IndiaRF MD Shantanu Nalavadi said: "The purpose of this investment is to not only restructure the company's balance sheet, but more importantly, work closely with the promoters and management team, to drive rapid revenue growth and sustainable profitability improvement." IndiaRF continues to remain focused on providing long-term strategic solutions that enable an effective turnaround for high quality companies that have the potential for accelerated growth and profitability, he added.
In similar vein, Panacea Biotec MD Rajesh Jain said: "We look forward to leveraging their proven global expertise in restructuring and turnarounds, and are certain that our combined efforts will now help accelerate our ambitious growth and profitability targets." Brescon & Allied Partners LLP were the exclusive advisors to the company on this transaction, advising on the one-time settlement with the banks and raising funding to back the revival plan, the statement said.
Shares of Panacea Biotec closed at ₹181.15 per scrip on BSE, down 0.19% from the previous close.