NewsOrders & DealsWarburg Pincus and EQT Compete for Minority Stake in Topical Pharma Firm Encube EthicalsWarburg Pincus and EQT Compete for Minority Stake in Topical Pharma Firm Encube Ethicals
Warburg Pincus and EQT are competing to acquire a minority stake in topical pharmaceutical company Encube Ethicals, following the withdrawal of Advent International from the process. Existing investors Quadria Capital (14.9% stake) and Gulf Islamic Investments are exploring complete exits from their 2021 investments made through a $34.2 million Series D funding round. The Mumbai-based company, founded in 1998 by Mehul Shah, specializes in dermatology products including Soframycin skin ointment and operates three manufacturing plants serving Indian and US markets with regulatory approvals from 12 overseas authorities including the US FDA.
*this image is generated using AI for illustrative purposes only.
Warburg Pincus and EQT are leading the competition to acquire a significant minority equity stake in Mumbai-based topical pharmaceutical company Encube Ethicals, as existing investors explore exit opportunities. The acquisition process has gained momentum following the withdrawal of Advent International, which had previously evaluated a proposal to buy equity in the company.
Investor Exit Plans Drive Acquisition Interest
The current acquisition opportunity stems from exit plans by two key investors in Encube Ethicals. Quadria Capital, a Singapore-based fund, is exploring plans to sell its entire 14.9% stake in the company. The fund originally acquired its shareholding in 2021 through strategic investment.
Gulf Islamic Investments, a United Arab Emirates-based investor, is also exploring an exit alongside Quadria Capital. Both investors became shareholders in Encube during the same period in 2021.
| Investment Details: | Information |
|---|---|
| Series D Funding: | $34.2 million |
| Year: | 2021 |
| Quadria Stake: | 14.9% |
| Participating Investors: | Quadria Capital, Gulf Islamic Investments |
Company Profile and Operations
Encube Ethicals was founded in 1998 by Mehul Shah and is headquartered in Mumbai. The company specializes in topical pharmaceutical products, with its key offerings including Soframycin skin ointment. The firm manufactures creams, gels, and ointments for dermatology and reproductive medications.
The company operates through three manufacturing plants located in Goa and Indore, focusing on healthcare markets in India and the United States. Encube has secured regulatory clearances from 12 overseas authorities worldwide, including approval from the US Food and Drug Administration.
| Company Overview: | Details |
|---|---|
| Founded: | 1998 |
| Founder: | Mehul Shah |
| Headquarters: | Mumbai |
| Manufacturing Plants: | 3 (Goa and Indore) |
| Key Product: | Soframycin skin ointment |
| Regulatory Approvals: | 12 overseas authorities including US FDA |
Ownership Structure and Transaction Expectations
Promoters led by founder Mehul Shah currently own 59% of Encube Ethicals. The successful buyer in the current process is expected to acquire the entire stakes of both Quadria Capital and Gulf Islamic Investments. Additionally, the founders may offer some of their stakes to potential buyers as part of the transaction.
Market Context
The competition for Encube Ethicals occurs against the backdrop of robust private equity activity in India. Private equity investments reached $49.3 billion in the January-November period of 2025, representing 88% of the $56.2 billion invested throughout 2024.
However, market conditions present challenges for deal execution. Valuations continue to remain elevated, and the bid-ask spread between sellers and investors remains the main impediment to faster private equity and venture capital deal closures. Despite these challenges, market observers remain cautiously optimistic about future investment activity.
17
