Decoding PharmEasy’s latest down round logic

The proposed rights issue, at a 90% valuation cut, makes one thing clear: it’s the investors who are calling the shots here.

In February, we wrote that API Holdings, the owner of online drug and medical services startup PharmEasy, might need to sell its diagnostic business Thyrocare to stay afloat. Soon after, the founders said they wouldn’t sell the business. But there were questions about how PharmEasy would pay off the loans it took to buy Thyrocare.

It seems we have the answer now.

This week, PharmEasy announced that it will raise around Rs 2,400 crore through a rights issue to pay off a loan from Goldman Sachs, according to a report in The Economic Times. The company is expected to …

Author

T Surendar

Surendar helps lead the newsroom at The Morning Context as executive editor. Over the years, Surendar has worked in industries from pharmaceuticals to diamonds, as well as a stint as an equity analyst. In his long career as a business journalist, he has led teams at The Times of India, India Today and Fortune India. He was part of the founding team at Forbes India and interned at and published in The Times, London.

Executive Editor

surendar@mailtmc.com

Mumbai