Orchid Chemicals and Pharmaceuticals is trading higher by 4% at Rs 116 after the company said it has divested its Penicillin and Penem active pharma ingredient (API) business, including its plant in Aurangabad, to US-based Hospira for around $200 million (Rs 1,200 crore).
“The sale includes the related Penicillin and Penem product portfolio and pipeline. Nearly 830 employees would be transferred to Hospira as part of the business transfer,” Orchid Chemicals said in a filing. The business sold accounts for around 23% of the total sales of the company last year.
The funds raised from this sale will be utilized for de-leveraging Orchid’s debt position and also pave the entry for the company’s foray into new product verticals, it added. The company has nearly Rs 2,200 crore as debt on its books.
The stock opened at Rs 115 and hit a high of Rs 118 on the BSE. A combined around 260,000 shares have changed hands on the counter in opening deals on both the exchanges.