Warburg in advanced discussions to buy medical equipment manufacturer Appasamy
Private equity firm Warburg Pincus is in advanced discussions to acquire Chennai-based medical equipment producer Appasamy Associates, said people aware of the growth. US-based Warburg has signed an exclusivity agreement with Appasamy, and the due diligence has started, they said. The promoters of Appasamy are expecting a valuation of Rs 4,000-4,500 crore, the people cited earlier said, adding that Warburg Pincus plans to acquire a 65-70% stake in the company and have the current management run the company.
Investment bank Edelweiss Finance is managing the sale process, the sources said. Appasamy Associates' executive director Arvind Kasthuri declined to comment. A query sent to Warburg Pincus remained unanswered. Appasamy Associates' promoters plan to sell a controlling stake in the company and have been involved in early-stage talks with private equity investors. The 45-year-old company is a leading manufacturer and distributor of ophthalmic equipment, microscopes, lasers, intraocular lens (IOL) and microsurgical instruments. It is the exclusive distributor for Canon's medical equipment in India.
In FY23, Appasamy Associates posted a revenue of Rs 500-550 crore with an Ebitda of Rs 130-150 crore, said sources. This year, it is expecting Rs 350 crore Ebitda. India is one of the largest eyecare markets by volume, where more than 6.5 million people undergo cataract surgery every year. The Indian intraocular lens market is dominated by global brands such as Alcon, Bausch Health, Biotech Healthcare Holding GmbH, Carl Zeiss AG, Hoya Holdings, Johnson & Johnson and French lens maker EssilorLuxottica SA.
The intraocular lens is implanted in the eye as part of a treatment for cataracts or myopia. Among the Indian brands, Appasamy is the market leader with about 75% market share. The other Indian brands are Aurolab and Locare. If the deal materializes, it would be Warburg Pincus' second acquisition in southern India in the last several months. Last week, the PE firm acquired about 67% stake in Coimbatore-based bath fittings brand Watertec India at Rs 2,600-2,800 crore ($340 million) valuation.
Investment bank Edelweiss Finance is managing the sale process, the sources said. Appasamy Associates' executive director Arvind Kasthuri declined to comment. A query sent to Warburg Pincus remained unanswered. Appasamy Associates' promoters plan to sell a controlling stake in the company and have been involved in early-stage talks with private equity investors. The 45-year-old company is a leading manufacturer and distributor of ophthalmic equipment, microscopes, lasers, intraocular lens (IOL) and microsurgical instruments. It is the exclusive distributor for Canon's medical equipment in India.
In FY23, Appasamy Associates posted a revenue of Rs 500-550 crore with an Ebitda of Rs 130-150 crore, said sources. This year, it is expecting Rs 350 crore Ebitda. India is one of the largest eyecare markets by volume, where more than 6.5 million people undergo cataract surgery every year. The Indian intraocular lens market is dominated by global brands such as Alcon, Bausch Health, Biotech Healthcare Holding GmbH, Carl Zeiss AG, Hoya Holdings, Johnson & Johnson and French lens maker EssilorLuxottica SA.
The intraocular lens is implanted in the eye as part of a treatment for cataracts or myopia. Among the Indian brands, Appasamy is the market leader with about 75% market share. The other Indian brands are Aurolab and Locare. If the deal materializes, it would be Warburg Pincus' second acquisition in southern India in the last several months. Last week, the PE firm acquired about 67% stake in Coimbatore-based bath fittings brand Watertec India at Rs 2,600-2,800 crore ($340 million) valuation.
