Piramal Enterprises has secured the approval of the National Company Law Tribunal for the demerger of its pharmaceutical business and the simplification of its corporate structure. With the approval in place, Piramal Enterprises (PEL) can proceed with its plans to have two separate listed entities — PEL, a non-banking financial company, and Piramal Pharma Ltd (PPL).
“We are on track to achieve the completion of demerger and separate listing of Piramal Pharma by the third quarter of the current financial year,” PEL chairperson Ajay Piramal said. Last October, the PEL board approved the demerger of the pharma business and simplification of the corporate structure. It has already obtained approvals from the RBI, Sebi, stock exchanges, creditors and equity shareholders.
In July this year, PEL said it had also received RBI approval for the NBFC licence. Subsequent to the demerger, PEL said as an NBFC it will have a loan book of $9 billion, while the pharma firm will be a significant player with revenues of nearly $1 billion.
Under the demerger scheme, four shares of PPL would be issued to PEL shareholders for every share held. While announcing the demerger PEL had also said that two of its operating subsidiaries will be amalgamated with PPL, to further simplify the pharma business corporate structure.
While Carlyle will hold 20 per cent in the pharma company, the promoters are expected to have a stake of 35 per cent. Sandoz demerger Novartis plans to spin off its generics unit Sandoz to sharpen its focus on its patented prescription medicines, the Swiss group said on Thursday, acknowledging it had not received any formal offers for the business to date.
The company started a strategic review of Sandoz last October — examining a range of options, including retaining the business, spinning it off or selling it — following a protracted period of underperformance driven largely by mounting pricing pressures in the off-patent drug sector.
Novartis has not received any formal binding offers for Sandoz so far — but if any “highly attractive” bids did emerge Novartis would fully consider them, CEO Vas Narasimhan told a media briefing on Thursday.
(With inputs from Reuters)
