Glenmark Pharma to divest 75% stake in subsidiary Life Sciences unit to Nirma for ₹5,651 crore

Glenmark Pharmaceuticals announced on Thursday, September 21, that it would sell a 75 per cent stake in its subsidiary unit Glenmark Life Sciences, to Nirma for ₹615 per share for an aggregate consideration of ₹5.651.75 crore. The Mumbai-based drugmaker will continue to own a 7.84 per cent stake in Glenmark Life Sciences with the stake reduction.

The company's board at its meeting held on September 21, 2023, considered and approved the sale of 91,895,379 shares representing 75 per cent share capital of Glenmark Life Sciences Ltd to Nirma Ltd at a price of ₹615 per share, aggregating to ₹5,651.5 crore, Glenmark Pharma said in a regulatory filing to the stock exchanges on Thursday.

As part of the transaction, the company, Glenmark Life Sciences and Nirma have agreed to certain non-compete and non-solicit arrangements for a specified period, according to the statement. Nirma, whose products range from soaps to cement, will make a mandatory open offer to all public shareholders of Glenmark Life Sciences.

Nirma had submitted its binding bid for Glenmark Pharmaceuticals stake in August. Private Equity firm ChyrsCapital was also in a race to take over Glenmark Pharmaceuticals stake, according to reports. 

The acquisition is subject to customary regulatory approvals. With this deal, the Nirma Group forays into active pharmaceutical ingredient (API) platform and expands its existing presence in pharmaceuticals portfolio consisting of injectables, parentals and ophthalmic products. This transaction closely follows the group’s acquisition of Stericon Pharma Private Limited in March 2023.

Glenmark Life Sciences Limited is primarily engaged in the business of development, manufacture and marketing of APIs. The company's product portfolio comprises of various therapeutic segments, which include cardiovascular (CVS) disease, central nervous system (CNS) disorders, diabetes, gastrointestinal health, oncology, pain management and anti-infectives.

On Thursday, shares of Glenmark Pharma settled 3.32 per cent lower at ₹828.05 apiece after hitting an intra day low of ₹822 on the BSE.