Pharma major Wockhardt on Wednesday announced the sale of select divisions of its branded generics business in India and four other countries to Dr Reddy’s Laboratories for Rs 1,850 crore.
“The board of Wockhardt approved divestment of part of domestic branded business to Dr Reddy’s comprising of 62 products and related business, assets and liabilities including manufacturing facility at Baddi, Himachal Pradesh, for a consideration of Rs 1,850 crore ($ 260 million),” it said in a statement. The business being transferred reported revenue from operation Rs 377 crore, which is 15 per cent of the consolidated revenue for nine-months ended December 31, 2019.
The proposed divestment is 3.8 times of annualised revenue of the business being transferred. This transaction is expected to be completed in May 2020, subject to shareholders, lenders and other requisite approvals under applicable statutes, it said.
“The intended sale of business portfolio is in line with the company’s strategic plan to shift from acute therapeutic areas to more chronic business like anti-diabetes, CNS and to its niche antibiotic portfolio of NCEs. The divestment will ensure adequate liquidity to bring in robust growth in the chronic domestic branded business, international operations, investments in biosimilars for the US market apart from the firm’s global clinical trials of break-through anti-infectives … and R&D activities,” said Habil Khorakiwala, founder chairman, Wockhardt Group.
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