Torrent in association with Fortress Investment Group and Greater Pacific Capital for Merck bid

The partners of Torrent Pharmaceuticals, in its bid to acquire Merck’s generics business unit, have come to light. New York-based private equity and hedge fund manager Fortress Investment Group and London-based private equity player Greater Pacific Capital, in association with Torrent Pharma, are close to bagging the over $2 bn-worth global generics business of Merck. This consortium and Israeli pharma company Teva may be the only two left in the fray with the other two global pharma majors Mylan and Actavis having dropped out of the race.

Fortress Investment Group has $30 bn in assets under management. This New York-headquartered group is largely into the businesses of private equity and hedge funds management. The private equity business of Fortress Investment Group manages approximately $17.5 bn of assets under management.

The other private equity firm, Greater Pacific Capital based at London, is a much smaller player with under $1 bn assets under management currently. Greater Pacific’s CEO and founder partner is Ketan Patel who was previously a managing director in the investment banking division at Goldman Sachs, where he founded the Goldman Sachs Strategic Group, a think tank at Goldman Sachs. Greater Pacific Capital invests primarily in equity or equity-related securities in public and private companies in India and China.

If this deal were to come through, it would be one of the biggest by an Indian company in the pharmaceutical sector. Torrent Pharma will have a minority stake while a big chunk of the funding will be done by Fortress Capital. If this consortium wins the bid then Torrent Pharma will manage the entire generics business, while the private equity players will be financial investors.

Read The Economic Times article.

Foreign investors pick 20% stake in Edelweiss Capital

Mumbai-based investment bank Edelweiss Capital has divested 20% stake to a number of financial investors including the Government of Singapore Investment Corporation (GIC) and the New York-based hedge fund Galleon Partners for around $90 mn.

Edelweiss will announce the deal soon after the Foreign Investment Promotion Board (FIPB) clears the investments.

With this transaction, Edelweiss is valued at around $400-450 million. The investment bank is also considering an initial public offer (IPO) by 2008 to give an exit option to its various investor groups. Prior to deal, employees and promoters of Edelweiss were holding around 74% equity stake, with Greater Pacific Capital (GPC), a London-based strategic investment firm and Americorp Capital jointly holding the remaining 24% stake.

Edelweiss was established in 1996 and now boasts of a team of around 600 people, with services ranging from brokerage to investment banking, asset management and insurance advisory. Edelweiss has been growing at 100% growth rate over the last 3 years. Revenues grew to Rs. 147 crores in 2005-06, from Rs. 73 crores in the previous year, while PAT grew to Rs. 42 crores from Rs. 24 crores.

Read The Economic Times article.