Emami close to acquiring controlling stake in Paras Pharma for Rs3,000-cr

Personal-care products maker Emami Ltd is close to acquiring a controlling stake in  Ahmedabad-based unlisted personal care firm Paras Pharmaceuticals Ltd, for around Rs3,000 crore.

The deal, if clinched by Emami, would pour cold water on the intense interest that other bidders like Taisho Pharmaceuticals, Reckitt Benckiser, Johnson & Johnson and Bayer had displayed after Pfizer, Merck, GlaxoSmithkline, Abbott Laboratories and Sanofi-Aventis decided to opt out of the fray.

Private equity firms, Actis Capital LLP, that invests in emerging markets, holds about 62 per cent of closely-held Paras, Sequoia Capital, one of Google Inc and Yahoo! Inc's early investors, owns about 8 per cent, while the remaining stake is held by Paras chairman Girish Patel and employees.

In September 2010, Actis Capital LLP and Sequoia Capital planned to exit Paras and were seeking around $700 million for their controlling stake.

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 London-based buyout firm.

Emami group director Harsh Agarwal had said in September 2010 that his company is keen on acquiring a controlling stake in Paras, but refused to comment on the price range of the proposed acquisition. (See: With Paras Pharma keen to sell, Emami ready to buy)