Canada’s CDPQ set to acquire 2% stake in PharmEasy; gets CCI nod

While PharmEasy is in an advanced stage to raise up to $200 million from Prosus Ventures, the company has received the Competition Commission of India’s approval for investment from CDPQ, Canada’s second-largest pension fund.

Caisse de dépôt et placement du Québec is an existing investor in PharmEasy and would acquire a 2% stake in PharmEasy’s parent entity API Holdings, a CCI notification shows.

CDPQ had participated in PharmEasy’s $220 million round in November of 2019.

While both parties didn’t disclose the details of the transaction such as the amount of investment or the valuation, according to Entrackr’s sources, the firm has not surpassed the $1 billion valuation with the transaction. 

The CDPQ investment is coming at a time when Prosus is in late-stage talks to lead a fresh round in PharmEasy that would put it in the coveted league of unicorns.

PharmEasy is yet to respond to Entrackr’s queries. 

Last year, the online pharma space witnessed consolidation when Reliance acquired NetMeds in a deal worth $88.5 million. Soon after the acquisition, PharmEasy and Medlife also merged to fight deep-pocketed Reliance and Amazon.

The merger had valued Medlife in the range of $240 million while the combined entity was valued at about $1.2 billion at the time of the transaction. However, regulatory filings analysed by Fintrackr showed that Medlife took a haircut of $135 million in valuation. The Patna-based company was valued at $375 million as of January 31, 2020. 

At present, Medlife’s promoters own a 19.95% stake in the merged entity while the rest is commanded by PharmEasy and its backers. 

Of late, online pharma retail and marketplace space has been witnessing intense competition and large groups are set for a fierce battle in 2021. 

Besides Reliance and Amazon’s entry in e-pharma, Tata Group too is set to acquire a majority stake in Gurugram-based platform 1mg. PharmEasy is the only large independent play left in the fray and to continue in the battle, it requires a sizeable war chest to keep the competition at bay.