India's top drugmaker Sun Pharmaceutical Industries Ltd has signed an agreement with Strides Arcolab Ltd to sell the erstwhile Ranbaxy’s marketing divisions Solus and Solus Care operating in the central nervous system (CNS) segment in India for Rs 165 crore ($23.9 million), according to a stock market disclosure.
The deal, which includes the transfer of employees also along with marketing divisions, is subject to approval from the Competition Commission of India and other customary closing conditions.
Early this month, the company had said it will sell a manufacturing facility that was owned by Ranbaxy in Ireland.
“The agreement with Strides is part of our strategy to firmly consolidate our CNS business in India. Post successful completion of Ranbaxy’s merger, we had an opportunity to assess the entire portfolio of our India business," said Abhay Gandhi, CEO – India business, Sun Pharma.
"We have evaluated each segment that we are present in and how these businesses can grow. Based on this evaluation, we believe that the potential of Solus and Solus Care divisions can be enhanced with the focus that Strides will put in growing them. The divestment will help these divisions, its customers and the team," he added.
As per IMS July 2015 MAT report, all the products of these two divisions together accounted for around Rs 92 crore in sales.
“The acquisition of Solus and Solus Care divisions is of strategic significance to the growth of our branded business in India. The rich product portfolio and capable teams of these two divisions will help us establish a strong footing in the fast growing CNS market of India," said Subroto Banerjee, president – brands, India of Strides Arcolab.
Strides' scrip was trading at Rs 1,180 a share, up 2.98 per cent on BSE in a weak Mumbai market at 1.38 PM on Monday.
Bangalore-headquartered Strides Arcolab develops and manufactures a range of IP-led niche pharmaceutical products. The company has eight manufacturing facilities and presence in more than 75 countries.
Sun Pharma, which has 48 manufacturing facilities spread across five continents, had completed the all stock-acquisition of Ranbaxy early this year. It has inked more M&As since then and last week said it would acquire US-based eye care company InSite Vision Inc in a deal worth $48 million, plus related debt and other transaction costs.