Torrent Pharma in advanced talks to acquire JB Chemicals from KKR

Torrent Pharma is negotiating to acquire JB Chemicals from KKR in a deal that may trigger an open offer, strengthening its position in the domestic pharma market

Torrent Pharmaceuticals is in advanced negotiations to acquire JB Chemicals & Pharmaceuticals from America-based private-equity firm KKR & Co, according to people familiar with the matter. 

The Ahmedabad-based drugmaker is looking to consolidate its presence in the domestic pharmaceutical market. 

KKR & Co owns 47.84 per cent in JB Chemicals and any transaction will trigger a mandatory open offer for public shareholders under takeover regulations. 

The private-equity firm’s stake was valued at ₹13,461 crore ($1.57 billion) as of Friday’s close, with JB Chemicals’ shares ending at ₹1,800 apiece, giving the company a market capitalisation of ₹28,080 crore ($3.27 billion). 

The stock has fallen around 4.5 per cent since the beginning  of the year. 

KKR declined to comment on the matter. An email sent to Torrent Pharmaceuticals on Friday did not elicit a response.

Torrent is said to be in discussion with global lenders to line up financing for the potential deal, said one of the persons close to the development.   

The Mehta family, which controls the Torrent group, owns 68 per cent in Torrent Pharma, which has a market value of ₹1.13 trillion.  

Founded in the 1970s by U N Mehta, a former medical representative with Sandoz, Torrent Pharma began as a small generics company focused on niche psychiatric drugs to avoid competition from multinational players. 

Under the present leadership of Sudhir and Samir Mehta, the company has expanded through acquisition, such as the domestic businesses of Elder Pharma and Unichem. 

In 2024-25, Torrent Pharma reported revenue of ₹11,516 crore and a net profit of ₹1,911 crore.

 

JB Chemicals, which KKR had acquired in 2020, posted revenue of ₹3,918 crore and a net profit of ₹660 crore in the same period (see chart). 

 

The Torrent group had previously explored a takeover of Cipla, but talks collapsed on valuation. Cipla’s founding family later offloaded part of its stake through block deals on the stock exchange.

 

Earlier this year, Torrent acquired a 67 per cent in Gujarat Titans, a franchise in the Indian Premier League, from CVC Capital for ₹5,000 crore, valuing the team at ₹7,453 crore.

 

Torrent Pharma is focused on the home market and draws around 55 per cent of its consolidated revenue from domestic formulations.

 

Sales in India grew 13 per cent in FY25 to touch ₹6,393 crore. While the company has been beating industry growth in the domestic market, it is planning to increase its medical-representative strength by 23 per cent by the end of FY26.

 

Analysts at Motilal Oswal said in a recent report the firm was working towards enhancing its over-the-counter franchise.

 

JB Pharma too is focused on sales of India-branded formulations.

 

Nikhil Chopra, chief executive officer and wholetime director, JB Pharma, had said after the Q4FY25 results: “Our domestic business continues to be one of the fastest-growing in the Indian pharmaceutical market. With 75 per cent of India-branded formulations sales in progressive, faster-growing segments, we are confident in sustained strong performance going forward.”

 

Both companies have a strong chronic focus. Last month chronic therapies grew 10 per cent while acute therapies (like antibiotics) went up 5 per cent. Growth leaders in May were Glenmark, JB Pharma, Ajanta, Sun, Intas, Dr Reddy’s, Mankind, Abbott, Ipca, Zydus, Indoco, Torrent, Emcure, USV, Alkem and Aristo.

 

Torrent has a strong presence in cardiovascular, gastrointestinal and neurology segments. JB too has strong cardiac and gastro brands like Cilacar, Metrogyl, and Rantac.

 

Torrent is working on launching GLP-1 products as a day-one launch in FY26.  Analysts expect a compound annual growth rate of 15 per cent in sales in domestic formulations for Torrent Pharma over FY25-27.