SeQuent Scientific Ltd is investing around Rs 116.5 crore ($19.15 million) to buy a minority stake in Shasun Pharmaceuticals Limited through a preferential allotment of shares and convertible warrants, as per a stock market disclosure.
Bangalore-headquartered custom research and manufacturing services provider SeQuent Scientific will subscribe to 3.5 million equity shares of Rs 2 each at a price of Rs 110 per share as also 7.1 million warrants at the same price, with each warrant convertible at par into equity shares.
Assuming full conversion of warrants, SeQuent will pick around 15.77 per cent stake in Shasun. Promoter holding will shrink from 41.97 per cent to 35.2 per cent of the diluted equity base.
Shares of Shasun Pharma last traded at Rs 123.7 a unit, up 5.68 per cent on Wednesday on the BSE in a strong Mumbai market. The markets are closed for trading on Thursday due to elections in Mumbai.
The deal extends the existing partnership between the two companies. Last July, Shasun Pharma and SeQuent Scientific signed a letter of intent to form a joint venture company to develop, manufacture and sell veterinary products which will include Active Pharmaceutical Ingredients (APIs) and formulations in the global market. SeQuent is the majority partner in the 73:27 JV.
Early this month, private equity firm Ascent Capital picked up minority stake in this JV christened Alivira Animal Health Ltd.
Shasun Pharma is an integrated, global supplier of development and manufacturing services for intermediates, API and formulations to the pharmaceutical industry. It is backed by healthcare focused private equity firm Orbimed.
(Edited by Joby Puthuparampil Johnson)