CCI approves Lightstone Fund’s stake acquisition in PharmEasy

The Competition Commission of India (CCI) on Wednesday said it has approved a stake acquisition by Lightstone Fund in 91Streets Media Technologies, which runs online drug delivery service PharmEasy.

Lightstone Fund is an investment unit of private equity firm LGT Lightstone.

Altogether, the antitrust regulator approved Lightstone’s stake acquisition in five companies. This includes Ascent Health and Wellness Solutions, API Holdings, Aahaan Commercials and Lokprakash Vidhya. The disclosure had no details on Aahaan Commercials and Lokprakash Vidhya.

Commission approves proposal of Lightstone Fund S.A. to acquire equity stakes in
Ascent Health and Wellness Solutions @HealthAscent
91Streets Media Technologies
API Holdings pic.twitter.com/Vfd0nbcvTF

— CCI (@CCI_India) August 26, 2020

PharmEasy was set to raise a $100-120 million equity financing round, led by a host of new investors including CDPQ, the second-largest Canadian pension fund, and LGT, according to an Economic Times report in July 2019.

PharmEasy declined TechCircle’s request for comment.

“91Streets is the holding company of only PharmEasy. Eventually, there will be a new structure. At a high level, what is happening is API Holdings is the new holding company which will have the shareholders of both PharmEasy and Ascent. Below that there are a bunch of other companies,” a person familiar with the matter told TechCircle.

It may be noted that Ascent Health and Wellness Solutions is an investor in 91Streets Media Technologies. The two have been in merger talks since 2019.

Earlier this month, PharmEasy sought approval for the acquisition of rival company Medlife, via API Holdings. In return, Medlife will receive 19.59% of ownership in the combined entity, filings with the competition regulator show.

The developments come at a time when the online pharmacy sector is seeing the entry of new players, including ecommerce giant Amazon and oil-to-telecom conglomerate Reliance Industries Limited (RIL).

Days after Amazon announced its entry in India’s e-pharmacy market, Mukesh Ambani led Reliance) signalled its intent to take on the Seattle headquartered company with the acquisition of a majority equity stake in Netmeds.

Founded in 2015 by Dharmil Sheth and Dhaval Shah, PharmEasy connects patients with chemist shops. It also uses a technology-enabled lead-generation platform that helps customers get cheaper diagnostic tests. 

The Mumbai-based company’s group firms are involved in the wholesale sale and distribution of drugs and pharmaceutical products, medical devices and over-the-counter (OTC) drugs. The firms also develop enterprise resource planning (ERP) and software solutions primarily for healthcare businesses and other customised application services for retail pharmacies.

The Lightstone Group, founded by David Lichtenstein, is a diversified privately held real estate company, headquartered in New York. In India, it also makes investments through LGT Lightstone Aspada, an impact investment fund that was launched in 2013.

Separately, CCI also approved the stake acquisition of Airtel’s data centre business, Nxtra Data, by the Carlyle Group, among other approvals disclosed on Wednesday.