Earum Pharmaceuticals Ltd, a publicly listed firm that markets, trades and distributes pharmaceutical formulation products, has acquired a majority stake in the Cedac Medicorp Pvt. Ltd, which manufactures medical products.
The Ahmedabad-based pharma firm said in a stock-exchange filing that it has acquired a 55% stake in Cedac Medicorp for a Rs 6 crore (approximately $800,000 at current exchange rates) cash consideration.
The transaction takes Cedac Medicorp’s valuation to Rs 11 crore, as per VCCircle estimates.
Earum said it expects the acquisition to close by the end of this month. Shares of the company were trading 0.63% down at Rs 47.55 apiece at the time of writing this report.
Gujarat-based Cedac Medicorp, formed in 2016, manufactures pharmaceutical products such as ointments, capsules, lotions, nasal drops and external powders. It operates in Ahmedabad.
The company reported a turnover of Rs 1.14 crore, Rs 5.87 crore and Rs 4.79 crore for the 2017-18, 2018-19 and 2019-20 financial years. It also reported net profits of Rs 18 lakh for the latest financial year
Earum Pharmaceuticals, meanwhile, was incorporated in 2012. It has a product portfolio including anti-inflammatory analgesics, tablets and capsules, injectable and oral suspensions, antacids and anti-emetic products.
The company is promoted by Bhumishth Narendrabhai Patel and Payal Bhumishth Patel.
Deals in the pharma and healthcare segment
The majority acquisition of Cedac Medicorp by Earum Pharmaceuticals is the latest acquisition move made by a company operating in the larger healthcare and medical space.
Earlier this month, Aster DM Healthcare sold its loss-making subsidiary in Kuwait to local companies for a consideration of around Kuwaiti Dinar 468,000 (roughly $1.5 million or Rs 11.34 crore).
Last month, VCCircle exclusively reported that single-specialty healthcare chain New Delhi Centre for Sight Ltd had acquired two eye-care centers owned by a business group.
In June 2019, IIFL Asset Management Ltd acquired a majority stake in Infigo Life Sciences Pvt. Ltd, which is promoted by Shridhar Thakur, former chief operating officer of eye-care chain Vasan Healthcare, and Anil Kamath, former managing director at Wockhardt Hospitals.
However, there have been delays and misses as well. Earlier this month, for example, it was reported that Aurobindo Pharma Ltd’s planned acquisition of the US generic oral solids and dermatology businesses of Sandoz Inc., a unit of Novartis AG, had fallen apart.
In a filing, the Indian drugmaker said the agreement was mutually terminated as approval from the US Federal Trade Commission for the transaction was not obtained within anticipated timelines.
Similarly, drugmaker Sanofi India Ltd last month said that it extended the deadline to sell a manufacturing unit in Gujarat to Advent International-backed Zentiva Pvt. Ltd because of a delay in receiving regulatory approvals.