India Resurgence Fund, a joint venture between the Piramal Group and Bain Capital, will invest up to ₹1,000 crore in Anthea Aromatics Pvt. Ltd for a controlling stake, the investment firm said in a statement on Monday.
About 27%, or ₹270 crore, will be primary funding while the remaining will be secondary, a person familiar with the matter told Mint. ICICI Ventures and other non-promoter shareholders are selling stakes, the person added.
In a secondary transaction, shareholders sell their stake to existing or new investors and no new capital is injected into the company.
Anthea’s market presence, proprietary development capabilities and manufacturing processes make it well-positioned to benefit from the opportunities that will present themselves, Shantanu Nalavadi, managing director of IndiaRF, said in a statement.
“The business needs capital infusion and leadership augmentation for its next phase of growth. We are committed to investing in the growth of Anthea through capacity addition, de-bottlenecking existing capacities, and enhanced R&D to broaden its product offerings,” Nalavadi said, adding that the Indian specialty chemicals sector presents a strong export opportunity.
IndiaRF investments
Stressed assets investment platform IndiaRF, which manages close to $850 million in assets from its maiden Fund 1, has 12 investments across nine sectors. Its investments largely focus on key India-centric themes such as domestic consumption, export-driven strategies, and core manufacturing.
The investment firm raised its first fund with a corpus size of $629 million from institutional investors such as Canada Pension Plan Investment Board (CPPIB) and the World Bank arm IFC alongside other high net worth investors and family offices in 2019. It has already clocked about seven exits in the first fund. Its investment in Anthea marks IndiaRF’s first investment from its second fund, which is currently being raised, and its second investment in the specialty chemicals sector.
Anthea, which is largely export-driven, generates over 80% of its revenues from international markets. It claims to have a global market and capacity share of 12-15%. It has a strong R&D setup and has developed and produced across a broad range of specialty chemicals, catering to growing end-use applications across flavours and fragrances, home and personal care, pharmaceutical and agrochemical industries.
Anthea’s plans
“We see significant export-led growth potential which IndiaRF’s expertise in business transformation will help unlock. We look forward to the journey under IndiaRF’s stewardship and are confident in scaling the business to new heights,” said Paul Menacherry, executive director, Anthea Group.
Founded by Vincent Paul in 1992, the leading aroma specialty chemicals group operates five manufacturing facilities across Maharashtra and Karnataka, with a combined capacity of 10,590 tonnes per annum.
Meanwhile, the global aroma specialty chemicals market size is valued at over $5.5 billion and is growing at a rate of about 5-6% annually, according to various market estimates. Of this, fragrance application accounts for the largest share of over 70% of the end use of aroma chemicals.