Suven to acquire controlling stake in Sapala Organics

Suven to acquire 67.5 per cent equity stake for a consideration of Rs 229.5 crore subject to customary working capital and net debt adjustments Suven has agreed to acquire an initial controlling stake, operate the business together with the selling shareholders for the next few years and eventually acquire 100 per cent of the shareholding in Sapala. Suven Pharmaceuticals has entered into a definitive agreement for a strategic controlling investment in Sapala Organics (Sapala), subject to regulatory approvals and conditions. Sapala is a Hyderabad-based CDMO focussed on Oligo drugs and nucleic acid building blocks including specialised/modified Amidites & Nucleosides, drug delivery compounds (including GalNAc), Pseudouridine, amongst others. Oligo and nucleic acid building blocks market is a ~$750M market and is expected to grow at a robust ~20 per cent CAGR. Sapala is one of the few players globally with experience in a comprehensive range of specialized building blocks. Sapala has a strong customer base including innovator Pharma, CDMOs & diagnostic companies, and is a key partner in their Oligo drug NCE programmes. On the acquisition, Annaswamy Vaidheesh, Executive Chairman, Suven said, “We are delighted to partner with Sapala and believe it is a strong strategic fit. We see massive potential given it’s a niche technology in the rapidly growing space. Nucleic acid-based therapy targets diseases at a genetic level and has the potential to help patients immensely and cure previously incurable conditions. With this acquisition, we now have multiple differentiated technology platforms such as ADCs and Oligos amongst others. We will continue to invest both organically and inorganically to further build on these.” Suven to acquire 67.5 per cent equity stake (i.e. 51 per cent of the share capital of Sapala Organics on a fully diluted basis) for a consideration of Rs 229.5 crore subject to customary working capital and net debt adjustments. The company will acquire the remaining equity stake a few months after FY2026-27, as per the terms of the definitive agreements. Upon consummation, the company will own 100 of the share capital of Sapala on a fully diluted basis. The transaction is subject to customary closing conditions. Steadmount Capital Advisors and Banyan Advisory acted as advisors to Sapala. Dr V Prasada Raju, MD, Suven added “Sapala has built unique capabilities in the complex Oligo building blocks segment. The space is poised to grow multi-fold with many of our customers looking to expand in this space. We are convinced that combining Sapala’s R&D depth, the team’s 30+ years of experience and Dr Reddy’s Japan experience with our customer access and manufacturing capabilities will help drive significant synergies across the entire platform.” Sapala was founded by Dr P Yella Reddy who has extensive experience in nucleic acid chemistry and formerly worked as Director (R&D) with Aisin Cosmos R&D Co Ltd (Toyota Group) in Japan & India for 20+ years. Dr P Yella Reddy, Founder, Sapala said “We have built Sapala as a unique CDMO player in the oligonucleotides value chain, largely thanks to the highly capable team that I have had the privilege of leading. Sapala has earned the trust of its customers over the last two decades by consistently taking up challenging projects and developing and scaling up highly complex technologies. A strategic partner like Suven, with its wider reach and resources will help to take Sapala to the next level while providing significant growth and development opportunities for Sapala's employees as well. We at Sapala are excited about the possibilities that this partnership brings. I also look forward to working with the larger team at Suven for their Japan market initiatives and hope to contribute to the platform’s success in that market.”