Pharmaceutical company Ind-Swift Laboratories Ltd will sell its API business to Synthimed Labs Pvt Ltd for an enterprise value of Rs 1,650 crore. The equity value for transaction is Rs 850 crore, considering an approximate debt of Rs 800 crore, the company said in a regulatory filing on Wednesday, September 6.

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"This will be subject to working capital and certain other agreed adjustments in accordance with the terms of the Business Transfer Agreement (BTA) which has been executed between the company and the buyer," the statement read.

PwC acted as the exclusive financial advisor to Ind-Swift on this transaction.

Synthimed Labs is a portfolio company of India Resurgence Fund (IndiaRF), which is a India focused investment platform promoted by Piramal Enterprises Limited and Bain Capital.

Commenting on the transaction, Shantanu Nalavadi, Managing Director of IndiaRF, said, “Ind-Swift has a strong market presence and competitive cost position. We believe the business needs the necessary capital infusion for it to acquire scale and move upwards in the growth trajectory. We are committed to invest further primary capital into the businesses to expand capacity on back of growth from newer geographies and investment in new product development across both API and CRAMS, to provide a larger portfolio of products to its customers.”

Ind-Swift Laboratories will invest Rs 80 crore in Synthimed Labs via Non-Convertible Debt (NCDs) and Compulsorily Convertible Preference Shares (CCPS).

"A sum of Rs 32 crore towards equity shares and 0.001 percent CCPS of Synthimed Labs, which will constitute 8.42 percent of the expanded share capital of Synthimed Labs. A sum of Rs 48 crore in NCDS of Synthimed Labs as per the terms of the issue of the NCDs," it said.

The Board of Ind-Swift Laboratories has also approved a proposal of amalgamation of Ind-Swift Ltd, a group company with Ind-Swift Laboratories Ltd.

"The Audit Committee and Board of Directors of the company will consider and approve the draft Scheme of Arrangement, Report on Valuation of Shares and Fairness Opinion Report and such other incidental documents in their forthcoming meetings. Intimation of the same will be circulated in due course."

The company will also convene the first "extra-ordinary General Meeting" of FY24 on Friday, October 6, 2023 at 11:30 am.

The firm has appointed Vishal Arora, Practising Company Secretary, as scrutinizer to scrutinize the e-voting process in a fair and transparent manner in connection with the general meeting of the company.

Shares of Ind-Swift Laboratories are locked in 20 percent upper circuit on BSE in trade Wednesday. At 3 pm, the scrip is trading 19.98 percent higher at Rs 123.40 per share.

First Published:Sept 6, 2023 3:05 PM IST