IGI Logo

Glenmark Pharma will sell a 75% stake in its life sciences unit to detergent maker Nirma for 56.52 billion rupees ($679.84 million) and use the proceeds to repay debt, the company said on Thursday.

The sale frees up Glenmark Pharma to focus on its business that sells branded drugs to treat skin and respiratory disorders, and invest in product development, as it eyes market expansion in Latin America, parts of Europe and India.

"Synergies between Glenmark Pharma and GLS business have been rapidly disappearing and companies have had divergent pathways," Glenmark Pharma Chairman Glenn Saldanha said in a press briefing.

The company had gross debt of about 46 billion rupees, Saldanha said.

The stake in Glenmark Life Sciences was sold at 615 rupees per share, a 1.8% discount to the unit's Thursday close, the company said in a regulatory filing.

Glenmark Life, which was listed in 2021 and competes with drugmakers such as Aurobindo Pharma and Torrent Pharmaceuticals, makes active pharmaceutical ingredients, or biologically active elements in a drug.

It reported revenue of 21.61 billion rupees for 2023, a 1.8% rise from a year earlier. Profit for the year was up 11.5% at 4.67 billion rupees.

The deal will help privately held Nirma, one of India's well-known brands, build its presence in the healthcare sector. The company acquired sterile contact lens solutions maker Stericon Pharma in April.

Nirma also made an open offer to GLS shareholders to acquire another 17.33% stake in the company at 631 rupees per share. Glenmark Pharma will hold a 7.84% stake in the life sciences entity after the deal.

Kotak Investment Banking was the financial adviser to both Glenmark Pharma and Glenmark Life.

Glenmark Pharma's shares have risen more than 95% so far this year, outperforming a 21.5% rise in the Nifty Pharma index, while Glenmark Life is up 49%.

($1 = 83.1373 Indian rupees)