PharmEasy and Ascent Health in merger talks

Online drugs retailer PharmEasy and pharmaceutical distribution company Ascent Health and Wellness have begun exploring a potential merger of the two Mumbai based private capital-backed companies, in what could turn out to be the largest consolidation in the space.

The boards of both companies, which count a number of marque private equity and venture capital investors such as Everstone Capital, Kedar Mankekar, Eight Roads Ventures and Orios Venture Partners among their ranks, are believed to have given them in-principle approval for the all-stock transaction to go through, according to three sources aware of the developments.

“The stakeholders of both companies have given the green signal for the merger about three weeks to a month back and the boards are also likely to give approvals soon,” said one of the sources on the condition of anonymity.

A potential merger between the two companies could likely see the newly-formed entity emerge as the largest player in the online pharmaceutical space, while also controlling its distribution and supply chain channels, critical for them to grow. For the country’s online drug retailers, gaining control over distribution and supply chain is critical. Almost all of them, such as MedLife and Netmeds, have invested in pharmaceutical distributors, but have thus far kept the investments at arm’s length.

Separately, Naspers, the South African media, internet and technology investor and a backer of some of India’s largest consumer internet ventures, including Flipkart and Swiggy, had also held discussions over investing in the new entity formed through the merger.

Sources told ET that Naspers could invest $100-150 million, at a valuation of $400-500 million. When contacted by ET, a Naspers spokesperson said that the company did not comment on rumours or speculations.

Tata Steel board approves merger of Bamnipal Steel & Tata Steel BSL

Tata Steel board has approved the merger of Bamnipal Steel and Tata Steel BSL (formerly Bhushan Steel Ltd) into the company.

The board has recommended a merger ratio of one equity share of Rs 10 each of Tata Steel for every 15 shares of Rs 2 each of Tata Steel BSL. As part of the scheme, the equity shares held by Bamnipal Steel and preference shares of held by Tata Steel in Tata Steel BSL shall stand cancelled.

The merger is subject to shareholders and other regulatory approvals, an official statement said on Thursday. Bamnipal Steel, a wholly owned subsidiary of Tata Steel completed the acquisition of Tata Steel BSL on May 18, 2018 through Corporate Insolvency Resolution Process under IBC. The board of Tata steel and Tata steel BSL proposed a merger of both the companies in the interest of maximising value to all stakeholders, the statement added.

Tata Steel CEO & MD, T V Narendran said: “The proposed merger will accelerate operational synergies, reduce the regulatory burden and simplify the group structure.” Both boards have relied on valuation reports and fairness opinions provided by independent experts and recommend a merger ratio of 15 shares of Tata steel BSL for every one share of Tata Steel, the official statement said.