Aurobindo Pharma Limited, a manufacturer of generic pharmaceuticals & active pharmaceutical ingredients (APIs) announced on Monday that it has signed an agreement to sell its US-based wholly-owned subsidiary, Natrol LLC to an affiliate of New Mountain Capital to combine with Jarrow Formulas. Reacting to the news, the share of Aurobindo Pharma gained nearly 4 per cent during the early trading session on Monday.
The all-cash transaction is priced at Rs 4,048 crore at the current exchange rate (USD 550 million). The transaction is expected to close by January 2021, subject to the customary closing conditions and regulatory approvals. Proceeds from the divestiture will be used for the reduction of debt and other new strategic initiatives.
Since the acquisition of the assets of Natrol in December 2014, the business has been consistently profitable and growing on all fronts under the ownership of Aurobindo Pharma.
The company is evaluating and concluding strategic options towards focussed portfolio enhancement with the ultimate objective of enhancing stakeholder values.
Aurobindo Pharma engages in formulation & APIs and caters to more than 100 countries. Location-wise, the company earns 50.5 per cent revenue from the USA, 31.7 per cent from Europe, 9.9 per cent from India, and 7.9 per cent from the rest of the world.
At 12.35 pm today, its share was trading 0.87 per cent higher at Rs 789.9. It recorded an intraday high of Rs 814.3 on BSE.