Tentamus Analytics Gmbh Acquired Majority Control of Business Operations Megsan Labs. IMAP India had advised Megsan Labs Private Limited on sale of a significant stake in the company.
Megsan Labs is a provider of analytical testing services for the pharma sector. It has a USFDA approved lab and employs approx. 150 people at its facility in Hyderabad. The company has been growing at a CAGR of 25%+ and achieved sales of Rs. 420 mn with an EBITDA of Rs. 250 million in FY19. In the past, the Company had raised equity from a group of financial investors to invest in infrastructure and scale up business operation. These financial investors were looking for an exit. Given the growth in the India market, Megsan felt it was the right time to consider a global strategic player that could provide the right platform to help the company scale to the next level. To realize this objective, Megsan executed a mandate with IMAP India to find a global strategic investor.
IMAP India had a good understanding of the global analytical testing market since it has executed several transactions in this space across geographies. Knowing the strong appetite for the global players in the Indian market, we decided to conduct a global bidding process. Using IMAP’s global network, we were able to reach out to relevant firms in US, Europe, Asia and Australia. Of the several bidders, Tentamus seemed to be a good fit considering that they did not have existing operations in India and were looking at Megsan as the platform to not only expand pharma testing services but also to launch testing services in food and environment. Tentamus was also very aggressive in its acquisition timelines and valuation.
Tentamus, headquartered in Germany, is a global company offering analytical testing services in pharma, food, cosmetics, agriculture and environment with presence across 50 locations worldwide. The deal was structured with Tentamus acquiring 60% stake in the first tranche with a put/call option for the balance 40% stake at the end of 4 years.
“IMAP team understood requirement of different shareholders and was able to manage expectations as well. They were clear in their communication with us and were able to handle all potential issues related to the transaction very practically.”
Jayapal Madireddy, CEO – Megsan Diagnostics
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