Zydus Cadila to sell India animal health business for Rs 2,921 crore

Pankaj Patel, Chairman, Cadila Healthcare
Cadila Healthcare’s (Zydus Cadila’s) wholly-owned material subsidiary Zydus Animal Health and Investments (ZAHL) is set to sell its animal healthcare business to a consortium led by Multiples Alternate Asset Management for nearly Rs 3,000 crore.

 

Zydus Cadila on Wednesday annou­nced ZAHL has entered into a business transfer agreement and other an­cillary pacts to sell and transfer its animal healthcare unit to the Multiples-led consortium. The deal is to sell one of the two business undertakings of ZAHL on a slump-sale basis as a going concern, for Rs 2,921 crore on a cash free and debt free basis, subject to certain closing date adjustments and other conditions.

 

The transaction involves transfer of immovable assets, movable assets, in­ventory, brands and intangible assets, contracts, licenses and permissions, bu­s­iness records, employees along with employee benefit funds, insurance policies, other assets and assumed liabilities. While Multiples, along with its consortium partners, will acquire 100 per cent of ZAHL’s unit, the slump sale transaction is subject to closing conditions and receipt of all statutory and other approvals. It is expected to be completed within a period of 90 days.

 

The Multiples-led consortium, whi­ch includes Canada Pension Plan In­vestment Board and RARE Enter­prises, has agreed to purchase the un­der­taking through a special purpose vehicle (SPV) called Zenex Animal Health India.

 

Commenting on the deal, Cadila Healthcare Chairman Pankaj Patel said that over the last three decades, ZAHL had grown to become a pioneer and one of the market leaders in the Indian animal health industry.

 

“With Multiples and its consortium partners committed to growing the business, we are sure that ZAHL will continue to grow and stre­ngthen its position in the industry.”

 

One of the fastest growing animal health businesses in India, ZAHL claims leadership position across a spectrum of therapeutic and nutritional products for livestock and poultry animal segments, employing roughly 700 people. It has a manufacturing facility in Hari­dwar. According to Arun Atrey, managing director of ZAHL, the deal is ex­pected to be seamless for the customers, suppliers and other stakeholders, with no disruption in operations.

 

Multiples Alternate Asset Manage­ment Founder and Chief Executive Renuka Ramnath said the consortium will be able to invest in a business that has been helping farmers enhance their productivity and inco­mes. “I expect Multiples to do many such large transactions in the coming years. We are also delighted to partner CPPIB and RARE Enterprises for our first consortium deal. We look forward to working with them and helping the company unlock its full potential and create value for all stakeholders,” added Ramnath.

 

RARE Enterprises partner Rakesh Jhunjhunwala said the animal healthcare business segment had “huge gro­wth potential” with the acquired firm having a top quality management team.

 

 



Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel