**Avendus Future Leaders Fund Invests ₹300 Crore in Aragen Life Sciences**
Avendus Group’s private equity fund, the Avendus Future Leaders Fund (FLF), has made a significant investment of ₹300 crore for a minority stake in Aragen Life Sciences, partnering with SBI Life Insurance, which also contributed ₹150 crore. This investment comes from FLF III and represents a secondary transaction, with both investors acquiring over 2.5% of Aragen from the Reddy Investment Trust, linked to the GVK Group. The Trust reduced its stake in Aragen, previously known as GVK Biosciences, before its rebranding in December 2020.
Ritesh Chandra, managing partner of the Avendus Future Leaders Fund, noted in an interview that healthcare has been a consistent focus for investment funds, and this marks their second deal in the sector. The fund aims to invest in late-stage companies across its three investment vehicles.
Aragen Life Sciences, based in Hyderabad, operates as a contract research, development, and manufacturing organization (CRDMO), offering services such as drug discovery, development, and manufacturing to clients in the healthcare and pharmaceutical sectors.
Chandra emphasized that the fund’s strategy remains unchanged across its three funds, stating, “We’re more of a passive fund that takes stakes in large businesses. We don’t compete with private equity; we collaborate with them to enhance the ecosystem. Our stakes are typically under 5%.” Other notable investors in Aragen include Goldman Sachs and Quadria Capital, which invested $100 million for a minority stake at an approximate valuation of $1.4 billion. Chandra mentioned that with their investment, the valuation is close to the previous funding round.
The Avendus Future Leaders Fund’s initial foray into the healthcare sector was with La Renon Healthcare in February, where they acquired a minority stake for ₹160 crore.
Avendus operates three Future Leaders Funds, with FLF I at ₹350 crore and both FLF II and FLF III at ₹1,500 crore, the latter having a greenshoe option for an additional ₹1,500 crore. The fund achieved a first close of ₹850 crore in January and is approaching its ₹1,500 crore target. Chandra indicated that due to strong interest from investors, they are likely to utilize the greenshoe option. Currently, 21% of FLF III’s capital has been deployed, with plans for further investments over the next two and a half years to mitigate exposure to economic fluctuations.
Avendus holds a substantial market share in India’s technology and startup sectors, with its advisory business supporting numerous companies in various capacities.
**FAQ**
**What is the Avendus Future Leaders Fund’s investment strategy?**
The Avendus Future Leaders Fund focuses on late-stage companies, typically taking minority stakes under 5%, and collaborates with private equity firms to enhance the investment ecosystem.
