Get All Access for $5/mo

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

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Freepik

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.

Teena Jose

News Desk Reporter with Entrepreneur India

Teena is a post graduate in financial journalism. She has an avid interest in content creation, digital media and fashion.
News and Trends

K12 Techno Services Secures USD 40 Mn in Funding from Kenro Capital

The Bengaluru-based firm aims to expand aggressively, with plans to open 8–12 Orchids schools annually and onboard 100–150 schools under the Eduvate umbrella each year.

News and Trends

RapidCanvas Raises USD 16 Mn to Accelerate AI Innovation in Business Operations

The new capital will fuel the expansion of its innovative offerings and global reach.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

News and Trends

Former Cleartrip CEO Ayyappan R Eyes Quick Commerce with FirstClub

After stepping down as Cleartrip's CEO earlier this year, Ayyappan brings his expertise from leading positions at Flipkart, including his role as chief business officer at Myntra.

Business Ideas

87 Service Business Ideas to Start Today

Get started in this growing industry, with options that range from IT consulting to childcare.

Business News

These Companies Offer the Best Work-Life Balance, According to Employees

The ranking is based on Glassdoor ratings and reviews.