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Mumbai-based biotech firm Advanced Enzyme Technologies has inked an agreement with Hyderabad-based active pharmaceutical ingredients (API) maker JC Biotech to acquire a 70 per cent stake for Rs 50 crore.
The company is looking to acquire similar enzyme-focused companies, said C L Rathi, managing director of Advanced Enzyme.
The Indian enzyme market stood at $105 million last year. This, according to Rathi, is likely to grow 15 per cent to $279 million in 2022.
JC Biotech currently has about 50 per cent market share in the country. After the acquisition, Advanced Enzyme’s share might go up to 80 per cent.
JC Biotech manufactures an anti-inflammatory enzyme called Serratiopeptidase, and has a pipeline of biopharma molecules. It also has a fairly advanced technology for manufacturing docosahexaenoic acid and an omega-3 fatty acid, which are used in human nutrition particularly for heart patients and pregnant women.
Rathi said: “The API Serratiopeptidase has significant competitive advantage as well as flexibility in production. JC Biotech has the ability to handle solvent-based fermentation and recovery, which is highly complementary to our current production process.”
JC Biotech has a 40,000-sq ft production facility in Andhra Pradesh and has the ability to further expand its fermentation capacity of 60 cubic metres. Its revenues stood at Rs 39 crore till March 2016.
Advanced Enzyme offers enzymatic solutions for human nutrition, animal nutrition, and bio-processing industries. This acquisition is mostly funded through internal accruals and is to complete by year-end. This deal is expected to be accretive to the company’s earnings per share for FY17.
