Biocon Biologics Limited, a subsidiary of Biocon Limited, on Wednesday said it has signed definitive agreement with Eris Lifesciences for the divesture of its Dermatology and Nephrology branded formulations business units in India.

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The total transaction value of the divestment is ₹366 crore. The divestiture is expected to close by the end of November 2023, subject to customary closing conditions, the company said in a filing.

"Total transaction value of the divestment is ₹3,660 million, inclusive of working capital conveyed as part of the deal, and represents an accretive multiple of 4 times on Revenues and 22 times on EBITDA," the company said.

One the deal closes, more than 120 employees of the two business units are expected to transition to Eris.

"This divesture of non-core assets allows Biocon Biologics to unlock value within our Branded Formulations portfolio in India and sharpen focus on our core therapy areas like Diabetes, Oncology and Immunology. We believe that Eris Lifesciences is well positioned to build further on the Dermatology and Nephrology franchise in India. Biocon Biologics remains committed to a successful transition of employees of these business units, our product brands, and customers to ensure continuity for patients," said Shreehas Tambe, CEO and Managing Director at Biocon Biologics.

Biocon said the divestment of the non-core branded formulations business units in India is in line with BBL’s strategy to sharpen focus on core therapy areas as a fully integrated biosimilars company.

Commenting on the acquisition, Amit Bakshi, Chairman and Managing Director of Eris Lifesciences,said: "We have successfully demonstrated our ability to turn around and create value in acquired businesses. The acquisition of Biocon Biologics’ Nephrology and Dermatology Branded Formulations businesses in India is in-line with our strategic goals as well as our capital allocation framework."

"We are very happy to welcome domain experts in Nephrology and Dermatology from Biocon. I look forward to all of us working together to build a large franchise that will deliver immense value to patients. I am confident that this acquisition will deliver value to shareholders in line with the deals we have done in FY23 and prior,” Bakshi said.

First Published:Nov 8, 2023 4:55 PM IST