Deal to happen in 2 tranches, based on achievement of milestones. Innovcare plans to use the funds to augment its current product portfolio.
JM Financial Private Equity has bought a significant minority stake in nutraceutical firm Innovcare Lifesciences Pvt. Ltd, a person aware of the development said.
The valuation of the deal could not be independently verified. However, the transaction will happen across two tranches, based on achievement of operating milestones negotiated between the two parties, the person said, requesting anonymity.
JM Financial PE is investing around Rs 45 crore in the nutraceutical firm, he added
The Navi Mumbai-based company, founded in 2014 by Lalit K. Wadhawan, Dipin Varma, Chandan Rajmane and Vijay Dubey, sells branded nutraceuticals, cosmeceuticals and dietary supplements across India.
Backed by Sequoia Capital India, the local arm of Silicon Valley venture capital firm Sequoia, Innovcare works with over 500 sales executives and more than 36,000 healthcare practitioners across specialties such as orthopaedics, gynaecology, dermatology, diabetology, cardiology and sexual wellness.
The company plans to use the fresh capital to fuel its expansion plans, the person said. “The proceeds will also be used to augment Innovcare’s current product portfolio and expansion into new therapeutic areas.”
According to a report by industry body Assocham and market research firm MRSS, the Indian nutraceuticals market is estimated to grow at a CAGR of 21 percent from $4 billion in 2017 to $10 billion by 2022.
JM Financial India Fund II has so far deployed about 40 percent of its proceeds across five companies, including Innovcare Lifesciences.
JM’s second fund is a sector-agnostic growth fund, which invests in high-growth, small- to mid-market companies, focused on financial services, consumer, information technology (IT) and IT-enabled services (ITES), infrastructure services and niche manufacturing sectors.
The last four investments from this fund are India Home Loan Ltd, an affordable housing finance company, Vendiman Pvt. Ltd which operates snack and beverage vending machines, Isthara Parks Pvt. Ltd, an operator of co-living spaces and Spandana Sphoorty Financial Ltd, a micro-finance institution which got publicly listed on 19 August.
In April, Mint had reported that JM Financial PE was set to hit the final close of its Rs 600 crore second private equity fund. The first close, Mint reported in April 2018, was at around Rs 300 crore.
In 2016, JM Financial had hired Darius Pandole, the former partner at private equity fund New Silk Route, to head its PE business.
Its first PE fund had invested in Mumbai-based pharmaceuticals firm DiagnoSearch Life Sciences Pvt. Ltd, salon chain Enrich, offshore logistics services firm Samson Maritime Ltd, farm equipment maker International Tractors Ltd, auto parts company Sona Group, and microfinance firm Spandana Sphoorty.
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