PharmEasy Plans To Raise INR 2400 Crore At 90% Valuation Markdown: Report PharmEasy's parent API Holdings will issue new stock at INR 5 per share in the rights issue, stated the report
By Teena Jose •
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Online pharmacy startup PharmEasy is planning for funding at a 90% markdown from its last valuation to pay back a loan. According to an ETtech report, the company has informed its board and investors that it plans to raise around INR 2,400 crore through a rights issue, to pay back the loan from Goldman Sachs.
The rights issue will be led by PharmEasy's existing shareholders TPG and Temasek. Moneycontrol reported that Manipal Group has expressed interest in investing INR 1,800 crore for an 18% stake in API Holdings, the parent company of PharmEasy and Thyrocare.
The company's board is expected to include Ranjan Pai, chairman of the Manipal Group, which has a stake in Manipal Hospital.
PharmEasy's parent API Holdings will issue new stock at INR 5 per share in the rights issue, according to documents seen by ETtech. At its peak, API Holdings had raised funds at INR 50 per share. The Mumbai-based epharmacy platform, which also owns diagnostics firm Thyrocare, was valued at $5.6 billion in 2021.
Reportedly, the rights issue will likely take place at a valuation of around $500-600 million. "After the covenant breach, the board and shareholders wanted the loan to be repaid to Goldman Sachs. Also the price of the share had to be readjusted as it was freely available for INR 20 in the grey market," reportedly said a person familiar with the developments, on condition of anonymity.
The company hoped to repay INR 2,000 crore of debt from the proposed INR 6,250 crore IPO proceeds. However, with API Holdings' plans to go public pushed back by two years to 2025, and hopes to raise pre-IPO capital of up to $300 million falling through last year, raising capital may not be so easy.
The healthtech company's previous valuation on a dollar-adjusted basis stood at about $4.6 billion, suggesting it's raising funds at a valuation 90% below its peak, as the ET report.
