Aurobindo Pharma rose 3.89% to Rs 723.15 at 9:45 IST on BSE after the company announced the signing of a definitive agreement to acquire certain assets from Sandoz Inc., US.
The announcement was made before trading hours today, 6 September 2018.Meanwhile, the S&P BSE Sensex was up 93.20 points, or 0.25% to 38,111.51.
On the BSE, 1.16 lakh shares were traded in the counter so far compared with average daily volumes of 2.27 lakh shares in the past two weeks. The stock had hit a high of Rs 724 and a low of Rs 699 so far during the day. The stock hit a 52-week high of Rs 808.95 on 7 November 2017. The stock hit a 52-week low of Rs 527.05 on 4 June 2018.
Aurobindo Pharma announced the signing of a definitive agreement to acquire certain assets from Sandoz Inc., USA ("Sandoz"), a Novartis division, comprising a market leading dermatology business and a portfolio of oral solid products along with commercial and manufacturing infrastructure in the US. The acquisition will be on debt free and cash free basis and will be made through its wholly owned subsidiary, Aurobindo Pharma USA Inc.
The acquisition for an upfront purchase price of $0.9 billion in cash including potential upside in near term earn-out and additional potential earn-out on pipeline product in outer years.
Aurobindo and Sandoz will enter into a transitional services agreement to support the ongoing growth plans of the businesses being acquired by Aurobindo. The transaction will be an all cash transaction which Aurobindo will finance through a fully committed debt facility. This US acquisition is in line with Aurobindo's strategy to strengthen and grow its global business and to expand and enhance its product portfolio offerings in key therapeutic areas.
The transaction is expected to close in the course of 2019 following the completion of customary closing conditions, including FTC clearance.
On a consolidated basis, Aurobindo Pharma's net profit fell 12.12% to Rs 455.66 crore on 15.48% increase in net sales to Rs 4181.56 crore in Q1 June 2018 over Q1 June 2017.
Aurobindo Pharma is a world-leading marketer and manufacturer of generic pharmaceuticals and active pharmaceutical ingredients.
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