Mumbai-based Advanced Enzyme Technologies Ltd (AETL) has identified two acquisition targets which it is close to finalising.
Targets 2 acquisitions for front-ending
HYDERABAD: With a view to strengthen its technology base and set up front-end marketing operations in global markets, Mumbai-based Advanced Enzyme Technologies Ltd (AETL) has identified two acquisition targets which it is close to finalising.
One of the biggest industrial and pharmaceutical enzyme makers in the country, AETL, has some 400 products in the market with another 200 in the pipeline, CL Rathi, managing director, told DNA Money.
“2008 is the year to go global and we have short-listed two acquisition targets for this purpose,” he said, declining to identify the companies before the deals were finalised. Each of the deals could be around $6 million in size, he said.
One of its targeted companies is a major player in the thermo stable enzyme products market and has its own IP while the other is a significant player in complex molecular bio-proteins, Rathi said.
According to research firm BCC Research, the market for industrial enzymes alone was estimated at around $2.3 billion in 2007 and is expected to be $2.7 billion by 2012 growing at a CAGR of 4%.
As per other projections, the world market for enzymes will grow at a CAGR of nearly 8% to $6 billion in 2011 driven mostly by growth in pharmaceutical enzyme demand, double-digit increases in demand for biocatalysts and rapid expansion in bioethanol production from grains, the research points out.
About 50% of AETL’s turnover comes from the pharmaceutical enzymes market with four other verticals, textiles, food and animal feeds, pulp and paper and distilleries making up for the remaining.
The company posted over Rs 250 crore turnover last year and became the biggest producer of enzymes in the country after the exit of Biocon which sold out its enzymes business to Novozymes for $110 million in June 2007.
AETL’s products include various enzymes for raw material inputs for pharmaceutical products like anti-inflammatory, digestive, cardiac care, probiotics and prebiotics.
The US continues to be the biggest market for enzymes in the world though China is fast emerging an attractive market particularly for industrial enzymes. China accounts for 70% of the world leather production, 40% of the garment production and 20% of pulp and paper production apart from a huge market for animal feeds, Rathi said.
Accordingly, given the attraction of the Chinese market, AETL is also actively scouting to pick up equity interest in some Chinese companies, he said, adding the company was targeting to take its global sales contribution to 50% from 20% now. “We have decided to take a long-term view,” he said.
p_chitti@dnaindia.net
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