TCL #40: Tata's $11bn Chip Bet, Sanofi's Patent Woes and Offgrid's Zinc Play

Businesses across sectors are placing large bets on alternatives to established systems. India is building its first semiconductor fabrication plant, worth $11bn. Zinc-based batteries are attracting investment as lithium supplies face constraints. Japanese chemical firms are pooling resources to reduce carbon emissions while maintaining production. Firms are seeking ways to reduce dependence on concentrated supply chains. The pharmaceutical industry shows similar patterns, with major acquisitions proceeding while companies face looming patent expirations. Environmental regulations, meanwhile, are creating demand for new monitoring systems. The common thread is pragmatic. Companies are adapting to tighter resource availability and regulatory pressure.

Battery

Offgrid Energy Labs, an Indian company focused on developing and scaling up zinc-based battery technology, has raised $15 million in Series A funding round that closed on September 2, 2025. The investment will be used to scale their proprietary ZincGel battery technology, establish a pilot facility in the UK, drive research and development for stationary energy storage, and advance the commercialization of their ZincGel batteries. Post commercialization, the company plans to set up its first gigawatt facility in India. The company aims to alleviate supply chain constraints associated with lithium.

Semiconductors

Tata Electronics and Merck Electronics have signed a Memorandum of Understanding (MoU) to strengthen semiconductor capabilities in India, including semiconductor materials and semiconductor fabrication infrastructure. Merck will provide Tata with its full suite of products and services which includes high-purity electronic materials, advanced gas and chemical delivery systems, turnkey fab infrastructure services, and Merck's Material Intelligence platform. Tata Electronics is building India's first semiconductor fab in Dholera, Gujarat, with a total of ~$11 billion. The fab will produce semiconductor chips for applications in automotive, mobile devices, artificial intelligence (AI), and other key segments.

Textiles

YiLab has secured over $10 million in a pre-Series A funding round. The materials science company was founded in 2024 and is focused on developing and commercializing thermoregulating fabrics that aim to enhance personal comfort while reducing global energy consumption and carbon emissions. The funding will be used to accelerate the development of its climate-driven textiles and establish a research lab and manufacturing facility in Asia.

Manufacturing

Asahi Kasei, Mitsui Chemicals, and Mitsubishi Chemical have established a limited liability partnership (LLP) called Setouchi Ethylene LLP with an initial capital of ¥1.5 million (~$10,100)  to advance carbon neutrality and optimize production capacity by 2030 for their ethylene manufacturing facilities in Western Japan. The LLP aims to achieve carbon neutrality through measures like biomass-based feedstocks and low-carbon fuels, optimizing the production framework, including potential future capacity reductions, and establishing a joint operating entity for the shared operation of ethylene manufacturing facilities.

Specialty Chemicals

Ingevity has agreed to sell its North Charleston crude tall oil (CTO) refinery assets and the majority of its Industrial Specialties product line to Mainstream Pine Products, LLC. The sale is an all-cash transaction values at $110 million at closing, with the possibility of an additional $19 million in contingent payments based on future business performance milestones. The deal is expected to be finalized by early 2026.

The sale aims to reduce portfolio volatility, strengthen Ingevity's margin and cash flow profile, and enhance future strategic options. The assets being sold are expected generated approximately $130 million in revenue for 2025, with EBITDA margins in the low-to-mid single digits. In addition to the sale, Ingevity and Mainstream have established supply and toll-manufacturing agreements. These agreements will support Ingevity's Road Technologies product line and certain Industrial Specialties products.

Pharma

• Bain Capital and Cinven have agreed to sell a majority stake in STADA to CapVest Partners LLC. The deal values the German pharmaceutical company at about €10 billion (~ $11.7 billion). The transaction is expected to close in early 2026. STADA specializes in consumer healthcare, generics, and specialty pharmaceuticals with sales of just over  €4 billion last year. This new development puts an end for now to STADA's previously reported plans for an Initial Public Offering.
• Sanofi's experimental eczema drug, Amlitelimab, showed uneven results, leading to a significant drop in the company's market value. Despite meeting its primary and key secondary endpoints, the data fell short of analyst expectations, causing Sanofi's shares to fall by around 10%. The market reaction is attributed to the patent expiration of Dupixent in 2031. Dupixent is a prescription injectable medication used to treat multiple inflammatory conditions including eczema and accounted for around 31.8% of Sanofi's group sales in FY 2024. Investors had hoped Amlitelimab would mitigate the impact of Dupixent's patent expiration.
• Thermo Fisher Scientific announced the completion of its acquisition of Sanofi's sterile fill-finish and packaging site located in Ridgefield, New Jersey. This acquisition is part of an expanded strategic partnership between the two companies, aimed at enabling additional drug product manufacturing in the United States.

Environmental Monitoring

Analytik Jena, in collaboration with Thuringian partners, is developing sensor technology for continuous monitoring of micropollutants in wastewater. The EU requires an 80 percent reduction in micropollutant contamination in wastewater by 2035 for large municipalities, necessitating improved data collection and targeted treatment approaches. The funding of over €2 million (~ $2.3 million) is provided by the Thuringian Ministry of Economic Affairs, sourced from the European Regional Development Fund (ERDF). The system being developed is based on  graphene field-effect transistor technology combined with components from separation column and mass spectrometry.

Plastics

Manner Polymers has opened a $54 million, 108,000-square-foot solar-powered PVC compounding plant in Mount Vernon, Illinois. The facility is designed to produce flexible PVC compounds for various industries, including electric vehicles and solar panels. The plant is powered by a 15-acre solar field located on-site, making it a 100% solar-powered operation. The plant is expected to be operational in Fall 2025 and projected to boost production capacity by 100 million pounds.