Glenmark Pharma announces proposed divestment of majority stake in Glenmark Life Sciences

Glenmark Pharma, a research-led, integrated, global pharmaceutical company, has entered into a definitive agreement with Nirma Limited to divest a 75% stake in its subsidiary, Glenmark Life Sciences Limited (GLS), at a price of Rs 615 per share for an aggregate consideration of Rs 56,515 million, subject to closing adjustments.

Glenmark Pharma owns 7.84% of GLS after the divestment. The transaction is subject to customary closing conditions precedent, including receipt of regulatory and shareholder approvals.

Pursuant to the transaction, Nirma Limited will make a mandatory open offer to all public shareholders of GLS.

Commenting on the divestment, Glenn Saldanha, Chairman and Managing Director of Glenmark Pharma, said, "We are pleased to announce this strategic transaction with Nirma Limited, which marks a significant milestone in shaping an independent growth trajectory for GLS. This deal aligns with our strategic intent of moving up the value chain to become an innovative/brand-led organisation, with a continuous focus on our core therapeutic areas of dermatology, respiratory, and oncology. It also presents an opportunity for us to strengthen shareholder value through deleveraging and enhancing our overall return profile."

Speaking on the announcement, Yasir Rawjee, Managing Director and CEO, Glenmark Life Sciences, said, "Today's announcement marks the next step in the journey of the company, one that will accelerate growth and help create more value for our stakeholders in the long term. We will continue to operate as an independent API company under the new ownership of Nirma Limited. I see this as an opportunity to further strengthen our position in the API industry and continue the growth trajectory."

Glenmark Pharma will continue to focus on consistent growth across its key markets while having a strong emphasis on return ratios with a net cash-positive balance sheet, ultimately creating value for its shareholders.

Kotak Investment Banking acted as the exclusive financial advisor to Glenmark Pharma and GLS on this transaction. S&R Associates acted as legal advisor to Glenmark Pharma and Trilegal acted as legal advisor to GLS.