The merger with no buyer: how a sponsor combines two companies it already owns

In February 2024, Advent announced that it would merge its private Cohance Lifesciences into its listed Suven Pharmaceuticals, paying entirely in shares at 11 Suven shares for every 295 Cohance shares. There was no buyer and no cash. The merger took effect on May 1, 2025, leaving Advent with 66.7% of a ~$3 billion contract drug manufacturer whose results so far are a trough, not a triumph.

THE BIG IDEA

Advent owned two Indian drug-manufacturing companies, one listed and one private, and instead of selling either it merged them into each other. No cash changed hands; the private company's shareholders were simply handed shares of the listed one. The result is a single ~$3 billion contract manufacturer, planned from the day Advent first bought in.

• The setup. Advent entered Suven in December 2022, paying ₹ 6,313 crore for 50.1% at ₹ 495 a share plus an open offer. The merger was announced in February 2024 as a scheme of amalgamation: Cohance's shareholders received new Suven shares at a fixed ratio set by independent valuers, and no money moved between the companies.
  • In plain terms, a scheme of amalgamation: a court-approved merger in which one company absorbs another and the absorbed company's shareholders are paid in the survivor's shares rather than cash. Here the listed Suven survived, absorbed the private Cohance, and was then renamed Cohance Lifesciences.
• The move. Both sets of shareholders approved by roughly 100% in November 2024, the NCLT sanctioned it in March 2025, and it took effect on May 1, 2025. Suven was renamed Cohance Lifesciences, Advent held 66.7%, the public 33.3%. Advent then extended the platform, buying the US ADC specialist NJ Bio for about $100M and the oligonucleotide firm Sapala Organics.
• The point. Two lessons in one deal. For strategy: a listed portfolio company is a platform, not just a holding, and merging a private asset into it builds scale while creating a public currency for future deals. For deal-making: a share-swap merger between commonly owned companies moves no cash and needs no buyer, so the whole contest is the swap ratio, which is why independent valuers, not a negotiation, set it.

The deal at a glance

• ~$3B COMBINED PLATFORM VALUE
• 66.7% ADVENT'S STAKE POST-MERGER
• 11 : 295 SUVEN-TO-COHANCE SWAP RATIO
• 3 MODALITIES: SMALL MOL, ADC, OLIGO

The structure in one view: one owner, two companies, merged into a single listed CDMO paid for in shares. Sources: scheme of amalgamation.

DEAL RADAR

The numbers

A plan years in the making: buy the listed company in 2022, merge in the private one in 2025, then keep building. Sources: Advent, Suven filings.

What actually happened. Hyderabad and Boston, 2022 to 2026

• A sponsor bought a listed shell, then filled it with its own private asset. When Advent took control of Suven in 2022, the merger with Cohance was already the plan. A listed company gives a sponsor a public currency, tradable shares, and a ready vehicle to consolidate into. Merging in a private portfolio company it also owned turned two sub-scale businesses into one listed platform, without an auction, a buyer or a cash outlay.
  • Why that matters: this is a distinct PE playbook. Rather than exit two assets separately at sub-scale multiples, a sponsor combines them inside a listed vehicle to create something larger and more valuable, and keeps control of the result.
• The whole negotiation was the swap ratio, because there was no cash. With Advent on both sides, the merger could not be a price negotiation; it was an exchange of shares at a ratio. That ratio, 11 Suven for 295 Cohance, decides how the combined company is split between the two shareholder bases, so independent valuers set it and the court blessed it to protect Suven's public minority. When one owner merges its own companies, fairness of the ratio is the only real question.
• The platform kept expanding after the merger, into complex, higher-margin work. The merged company did not stop. It bought NJ Bio in the US for antibody-drug conjugate capability and Sapala for oligonucleotides, extending from ordinary small-molecule work into the complex modalities that command premium margins and where leaders like Lonza compete. The merger built the base; the bolt-ons are the ambition.
  • In plain terms, a CDMO: a contract development and manufacturing organisation, a company that makes drugs and drug ingredients for other pharmaceutical firms. The complex modalities, ADCs and oligonucleotides, are harder to make and so earn higher margins than standard chemistry.

FEATURED DEAL

The merger with no buyer: how a sponsor combines two companies it already owns

Real deal, merger announced February 29, 2024; effective May 1, 2025; integration ongoing through FY27. Figures from Suven and Cohance filings, the NCLT order and verified media. Not investment advice.

First, what makes it unusual

• There was no buyer and no seller. Advent already owned controlling stakes in both Suven and Cohance, so the merger was between two companies under the same roof.
• No cash moved. Cohance's shareholders, chiefly Advent, received new Suven shares instead of money, at a ratio fixed in advance.
• And the deal could not be blocked on price, only on fairness, because the only variable was how many Suven shares each Cohance share converted into.

The three-part answer

• A share swap replaces cash when the same owner is on both sides. Because Advent controlled both, paying cash for one with the other would just move money within its own portfolio. Issuing Suven shares to Cohance's holders instead combines the businesses and re-slices the ownership without spending anything. When common ownership sits on both sides, a swap is the natural structure, and the ratio does the work a price would.
• The swap ratio is the entire deal, so a third party has to set it. At 11 Suven for 295 Cohance, the ratio determines what share of the combined company each side ends up with. Because Advent benefits whichever way it tilts, it cannot set it credibly itself, so independent valuers PwC and BDO fixed it and a fairness opinion backed it. In a related-party merger the valuers are not a formality; they are the only thing between the sponsor and the public minority.
• The listing is the point, not an incidental. Advent could have merged the two privately, but keeping the combined company listed as Suven gives it a public currency and a market valuation, which is what let the platform later raise capital for NJ Bio and Sapala. Merging a private asset into a listed one, rather than the reverse, is a deliberate choice to inherit a stock-market presence, worth more than the mechanics suggest.

A merger paid entirely in shares: 295 Cohance shares became 11 Suven shares, and Advent ended at 66.7%. Sources: scheme of amalgamation, NCLT order.

SECTOR SIGNAL

Three things this deal confirms about Indian pharma manufacturing and private equity

What the merger builds: one platform spanning small molecules, antibody-drug conjugates and oligonucleotides. Sources: investor presentation.

• India's contract drug manufacturing is consolidating into scaled platforms. India's CDMO sector is among the fastest-growing globally, lifted by China-plus-one supply shifts and rising pharma outsourcing. But individual Indian players are small against Lonza, WuXi and Samsung Biologics, so the value is in combining them into platforms with real scale, which is exactly what merging Suven and Cohance does. Expect more consolidation as Indian CDMOs chase global relevance.
• Private equity is building listed platforms, not just buying and flipping. Advent's move, buy a listed company, merge in a private one, then bolt on more, is a platform-building playbook, not a quick trade. As Indian sectors mature, sponsors increasingly assemble scaled, listed businesses over multiple years rather than acquiring and exiting single assets, because the combined platform commands a valuation neither piece could alone.
• The complex modalities are where the margins and the risk both sit. The platform is pushing beyond ordinary chemistry into antibody-drug conjugates and oligonucleotides, which earn premium margins but are harder to make and slower to ramp. NJ Bio, the ADC business, is losing money early on. The bet on complexity is where the upside is, and also where the execution risk concentrates, so these deals are judged on the ramp, not the acquisition.

The merger was the base; NJ Bio and Sapala are the buy-and-build on top, reaching into complex biologics. Sources: investor presentation.

VALUATION PULSE

Is a ~$3 billion CDMO platform worth it? Three ways to judge it, honestly

The honest picture: revenue fell in the first years after the merger, on destocking and early losses in the newly acquired ADC business. Sources: company results.

• What a 'trough year' means: a low point management expects the business to climb out of. FY26 and early FY27 revenue fell on customer destocking and losses at the newly bought NJ Bio, and the company guides recovery from H2 FY27, so the current numbers are meant to understate the platform's potential, if you believe the guidance.

The discipline. Judge this one on the recovery, and be honest that it has not arrived. The whole ~$3 billion thesis rests on complex-modality growth and a rebound from the destocking trough, and so far the numbers have gone the wrong way: revenue down 13% then 23%, EBITDA margin collapsing to 2.2%, a chairman changed, a CFO resigned, Jefferies at Underperform. None of that is fatal for a platform still being assembled, but none is proof the thesis is working either. This is a deal to watch, not to conclude on, and the honest verdict today is: ambitious, expensive, unproven.

DEAL STRUCTURE CLINIC

The related-party share swap, and why the valuers matter more than the price

In plain terms, a related-party merger: A merger between two companies controlled by the same owner. Because that owner sits on both sides, it has an incentive to set the terms in its own favour, so the law requires independent valuation and, for a listed company, protection of the minority shareholders who do not share that control.

In plain terms, a swap ratio: The fixed exchange rate at which one company's shares convert into the other's in a merger. Here every 295 Cohance shares became 11 Suven shares. The ratio, not any price, determines how the combined company's ownership is divided.

Three mechanics this deal showcases

The logic of the structure: two sub-scale companies sold separately are worth less than one integrated, listed platform. Sources: Advent, Suven filings.

• A swap conserves cash and re-slices ownership. Because no money changes hands, a share-swap merger lets a sponsor combine businesses without funding a purchase, and the ratio simply redraws who owns what. When the same owner controls both companies, this beats a cash sale, which would only shuffle money within the portfolio. The structure fits the ownership.
• Independent valuers replace the missing counterparty. In an arm's-length deal, buyer and seller negotiate and each protects its own interest. Here there was no opposing party, so PwC valued one side and BDO the other, and a fairness opinion and the NCLT stood in for the negotiation that could not happen. In a related-party merger, the valuers are the counterparty, which is why their independence is the whole safeguard.
• The listing is a strategic asset in its own right. Advent merged the private company into the listed one, not the other way round, so the combined entity kept Suven's stock-market listing. That listing is a public currency the platform can use to raise capital and pay for acquisitions, which is exactly how it funded its later bolt-ons. When you choose which entity survives a merger, you are choosing which advantages the combined company inherits.

M&A 101

Building a listed platform from your own portfolio: the three-step playbook

In plain terms, a platform roll-up inside a portfolio: A sponsor that owns several companies in one sector combines them, often into a listed vehicle, to create a single larger business. The pieces are assets the sponsor already controls, so the work is integration and value creation, not acquisition.

The three steps, using this deal

• Step 1: Acquire a listed anchor for its currency. A listed company gives you tradable shares and a public valuation, both of which private assets lack. Advent bought control of listed Suven in 2022 with the merger already planned, so the combined platform would be public. When you intend to build by acquisition, owning a listed anchor first gives you the currency to pay with.
• Step 2: Merge in your private assets by swap, and get the ratio blessed. Combine the companies you already own using share swaps rather than cash, and, because you are on both sides, have independent valuers set the ratio and a court protect the minority. Advent merged Cohance into Suven at a valuer-set ratio approved by ~100% of both shareholder bases. Do the fairness properly, because a related-party merger lives or dies on the credibility of the ratio.
• Step 3: Bolt on capability, then prove the integration. With the platform listed and scaled, add the capabilities you lack, Advent bought NJ Bio for ADCs and Sapala for oligonucleotides, then do the hard part: make the combined thing actually work. The assembly is fast and visible; the integration is slow and is where the return is truly earned, often after the headlines have moved on.

Assembled, ambitious and unproven: the platform is built, but a trough and management churn mean the thesis is not yet demonstrated. Sources: Q1 FY27 results, Jefferies.

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