Encube Ethicals stake sale on hold, IPO likely by 2027

Global private equity firms including Warburg Pincus, EQT, and Partners Group had shown interest in acquiring the business at $1.5-1.6 billion (₹13,980-14,912 crore) valuation. However, this fell short of the $2 billion valuation sought by the promoters and existing investor Quadria Capital, said the people cited above.

“As the promoters plan an IPO in the next 12-18 months, Quadria Capital is likely to stay invested and partially exit through the public offering,” one of the persons said.

Promoter Mehul Shah and his family currently hold around 84.2% in the company, while Quadria owns 14.9%, with the remainder held by other investors and the ESOP pool. Quadria had acquired the stake in 2021 at a valuation of $800 million.

Agencies

Bidders’ valuation of $1.5-1.7 b failed to match the $2b sought by promoters, investors

A consortium led by Warburg Pincus and Abu Dhabi sovereign wealth fund Mubadala Investment Company had emerged as the frontrunner to buy up to a 74% stake in the company, ET reported last month.

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Quadria had appointed JPMorgan to run the sale process.
Encube is a generics-focused pharmaceutical contract manufacturer known for brands such as Soframycin. Founded in 1998, Encube specialises in topical formulations and has built a strong portfolio spanning creams, gels, and ointments catering to dermatology and reproductive healthcare. In 2021, the company entered the consumer healthcare space by acquiring brands such as Soframycin, Sofradex, Sofracort, and Soframycin-Tulle from Sanofi for India and Sri Lanka in a deal worth around ₹125 crore.