PharmEasy Plans Rs 3,500 Crore Rights Issue Next Week to Repay Debt: Report

• ByStartupStory     |    August 26, 2023

Mumbai-based online medicine seller, PharmEasy, is gearing up to raise Rs 3,500 crore through a rights issue next week, according to a report by Mint. The proceeds from this initiative will play a pivotal role in repaying a substantial portion of its debt owed to Goldman Sachs.

The rights issue will encompass a commitment of Rs 2,000 crore from existing investors such as Temasek Holdings, TPG, Prosus, CDPQ, Eight Roads, LGT, Abu Dhabi sovereign wealth fund ADQ, Amansa, OrbiMed, and Sunil Kant Munjal’s family office, as mentioned in the report. Ranjan Pai, Founder of Manipal Health Enterprises, is also said to have consented to invest Rs 1,200 crore.

PharmEasy’s move to pursue a rights issue signifies an offer to its existing shareholders to acquire additional shares in a pro-rata fashion. The company’s decision comes after facing challenges earlier this year, including breaching the covenant on its term loan from Goldman Sachs in June. As a result, it sought additional funding or a potential restructuring of terms.

It’s worth noting that some of PharmEasy’s investors revised its valuation downward earlier this year. Neuberger Berman adjusted the valuation of its holdings to $4.4 billion, while Janus Henderson brought it down to $2.8 billion. As the company embarks on this rights issue, it aims to navigate the financial landscape and bolster its repayment capability.

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