Jubilant Organosys Ltd is the latest to join the bandwagon of firms planning to amalgamate and de-merge the entire pharma businesses. The Board of Directors of the company at its meeting held on July 08, 2010, approved a scheme of amalgamation and demerger among Jubilant Organosys Ltd, Speciality Molecules Ltd. (SML), Pace Marketing Specialities Ltd. (PMSL) and Jubilant Industries Ltd and their respective shareholders & creditors.
The shares of Jubilant Organosys went down 1.97% on the BSE to close at Rs 378.05 on Thursday.
Last week, Alembic Limited decided to de-merge its core pharmaceutical business into a 100% subsidiary company, Alembic Pharma Limited. The company on last Tuesday announced plans to de-merge its domestic formulation, international generic and API business to its subsidiary company.
Another major, Dr Reddy’s Labs (DRL) is learnt to be in the process of de-merging its formulation business into a separate entity for last few months. Last month, US pharma giant Abbott acquired the domestic formulation business of Piramal Healthcare for $3.7 billion last month.
As per the statement, amalgamation of SML, the wholly owned subsidiary of Jubilant Organosys will be done with the holding company- Jubilant Organosys. The shares held by Jubilant Organosys in SML will be cancelled and no shares shall be issued by Jubilant Organosys on this amalgamation.
In consideration of the amalgamation of PMSL with Jubilant Organosys, 5 lakh equity shares of Re.1 each of Jubilant Organosys will be issued to the shareholders of PMSL.
The share exchange ratio is based on v1 aluation by Price Waterhouse Coopers Pvt. Ltd. and fairness opinion by Kotak Mahindra Capital Company Ltd., which was tabled at Board meeting on July 08, 2010 and adopted by the Board, said the company statement.
The company will demerge its Agri & Performance Polymer Divisions to Jubilant Industries, a wholly owned subsidiary of Jubilant Organosys, will issue 1 equity share of Rs. 10/- for every 20 equity shares of Re.1 each held by a Shareholder in Jubilant Organosys as on the demerger record date. The shares of Jubilant Industries will be listed on BSE and NSE.