homebusiness NewsRakesh Jhunjhunwala and Multiples Asset buy Zydus Animal Health; Big Bull explains the rationale
Rakesh Jhunjhunwala and Multiples Asset buy Zydus Animal Health; Big Bull explains the rationale
Big bull Rakesh Jhunjhunwala and Multiples Asset have bought the animal healthcare business of Zydus Cadila in a Rs 3,000 crore deal. CNBC-TV18's Nisha Poddar spoke with Rakesh Jhunjhunwala, Partner, Rare Enterprises and Renuka Ramnath, Founder, MD and CEO of Multiples Asset Management and asked about the rationale of the deal.
Big bull Rakesh Jhunjhunwala and Multiples Asset have bought the animal healthcare business of Zydus Cadila in a Rs 3,000 crore deal. CNBC-TV18's Nisha Poddar spoke with Rakesh Jhunjhunwala, Partner, Rare Enterprises and Renuka Ramnath, Founder, MD and CEO of Multiples Asset Management and asked about the rationale of the deal.
“Today the production of eggs, milk, fruits and vegetables is far greater than the production of cereals in India. In everything in farming in India, we have some of the lowest yields in the world. There is scope to improve. Animal husbandry and poultry can be a big source of additional income for farmers. The government of India is very conscious of that and has launched many programmes to improve animal husbandry and poultry. So the opportunity is huge,” said Jhunjhunwala.
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“Animal health business requires a lot of products and distribution so it cannot be created in a day. There are big barriers. It is also like a generic pharma business for humans. We found that the management team is led by a very capable person, it will have good reasonable growth, there is scope for profitability, volume, there could be acquisition opportunities and we have paid a valuation between 19 and 20 times EBITDA which is the valuation which most generic pharma companies are doing. This is the reason I purchased,” he added.
“Rare Enterprises will have 30 percent in the company and the rest of it will be a consortium of Multiples own funds and that of its LPs,” Ramnath shared.
For more, watch the accompanying video
(Edited by : Abhishek Jha)
First Published: May 27, 2021 11:15 AM IST
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