Indian drugmaker Laurus Labs said it signed a definitive agreement to acquire a majority stake in a Bangalore-based, fast-growing biotech company, Richcore Lifesciences, for Rs 246.67 cr.
Richcore has advanced R&D and manufacturing facilities to develop and manufacture biotech products critical for manufacturing biological drugs.
Richcore also helps its global customers to develop and scale-up their bioprocesses by providing contract research, development, and manufacturing services.
“This acquisition marks Laurus Labs’ entry into the broader biologics and biotechnology segments, providing the company access to its high growth areas, globally and in India,” the listed company said.
Laurus Labs said it will help and drive Richcore to achieve scale and improve product offerings.
“With this acquisition, Laurus adds a fourth revenue stream to its three existing divisions – API, Formulations and Synthesis,” it said.
Richcore will be renamed to Laurus Bio Pvt Ltd.
The Bangalore-based company has large scale fermentation capabilities and manufactures animal origin free (AOF) recombinant products.
“These products help vaccine, insulin, stem-cell based regenerative medicine and other biopharma companies eliminate dependency on animal and human blood derived products and in turn produce safer medicines,” it said.
The acquired company is currently in its growth phase and its second manufacturing plant near Bengaluru is expected to be completed by 31 March 2021, Laurus Labs said.
Laurus Labs has signed a definitive agreement to acquire 72.55% of Richcore’s shares from Eight Roads Ventures and VenturEast for a value of Rs. 246.7 crores.
Richcore has raised early and growth stage funding from Eight Roads Ventures, VenturEast Proactive Fund and VenturEast Life Fund III.
The current promoters of Richcore led by Subramani Ramachandrappa will continue as promoters of Richcore and will be responsible for its management and operations.
Laurus Labs will fund the acquisition from its internal accruals and this acquisition will be revenue and PAT accretive.
Laurus Labs CEO Dr Satyanarayana Chava said the acquisition gives his firm an entry into the high barrier biotechnology segment.
“Laurus Labs will bring scale to Richcore’ s operations and can become a major player in the biotech CDMO space . This will also help Laurus in becoming a leader in biocatalysis as Richcore brings significant expertise in enzyme development for pharmaceutical and other industrial applications,” he added.
The latest move comes days after Laurus Labs said plans to spend as much as 1,500 cr rupees over the next 24 months to expand its production capacity.