International Finance Corporation (IFC), the private-sector investment arm of the World Bank, is looking to invest up to $60 million (Rs 387 crore) in Hyderabad-based vaccine maker Biological E Ltd.
The proposed investment will include debt financing from IFC’s own account (also called ‘A’ loans) and subscribing to the company's non-convertible debentures (NCDs), it said in a disclosure. The IFC board will take a final decision on the proposal in the third week of July.
Biological E will use the funds to part-finance the new manufacturing unit it is planning to set up at its vaccine facility in Hyderabad's Shameerpet area.
Founded in 1953, the company manufactures and sells vaccines either directly or through supplies to United Nations Children’s Fund and Global Alliance for Vaccines and Immunization. Besides, it also manufactures generic formulations for the Indian market.
A closely-held company, Biological E is promoted by Mahima Datla, who holds the majority of the company's shares, with the balance held by her family members.
In February, the company laid the foundation for its new vaccine manufacturing plant, which is being set up for an initial investment of Rs 300 crore in a special economic zone on the outskirts of Hyderabad. Biological E has five manufacturing units in India, and research and development facilities in India and France.
For 2015-16, it posted total revenue of Rs 1,017 crore while profit after tax stood at Rs 304 crore.
IFC has an active direct private equity-style investment practice in India. It also lends to firms and has an active limited partner portfolio in the country, where it backs PE and VC funds.
In February, IFC said it planned to make a debt investment of $47.5 million in drugmaker Granules India.
In June 2016, it proposed to invest up to $75 million in Glenmark Pharmaceuticals.
Earlier this month, IFC had announced that it will sell its entire 7.5% stake in Analjit Singh-led Max Group’s healthcare business for Rs 423 crore ($65.3 million). It is also planning to invest up to $200 million in HDFC through five-year NCDs or masala bonds.
In April, IFC said it planned to invest in Fullerton India Credit Company Ltd and Capital First Ltd via NCDs. Fullerton planned to use the capital for lending to micro, small and medium enterprises.