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Suven Pharmaceuticals and Cohance Lifesciences have announced a proposed scheme of amalgamation for the merger of the two companies.
Once the scheme becomes effective, they said, all shareholders of Cohance would be issued shares of Suven at the ratio of 11 shares of Suven for every 295 shares of Cohance. The new shares of Suven will be traded on the NSE and BSE. And Advent would own about 66.7 per cent and the public shareholders would hold the remaining 33.3 per cent of the combined entity.
The transaction is expected to conclude over the next 12-15 months, subject to receipt of all relevant shareholder and regulatory approvals, it added.
Cohance is a CDMO (contract development and manufacturing organisation) and merchant API (active pharmaceutical ingredients) platform with a global presence in select low-mid volume molecules, besides capabilities in the form of its antibody drug conjugates (ADC) platform. Their CDMO segment has grown at about 30 per cent-plus over financial year 2023 and contributes about 44 per cent to its gross profits for the nine months of this financial year, the note from the companies said.
The rationale
On the rationale behind the move, they said, the merger would establish Suven’s position as a diversified CDMO and API leader in the country. The merger would provide three distinct growth engines of growth — pharma CDMO, speciality chemicals CDMO, and APIs.
Annaswamy Vaidheesh, Suven Executive Chairman, said the merger was a transformative step in Suven’s journey of growth and building an integrated CDMO player.
Last September, private equity firm Advent International had announced a new board of directors and management team at Suven Pharma, having completed the acquisition of the Hyderabad-based contract development and manufacturing organisation (CDMO). In December 2022, Advent International had agreed to acquire a 50.1 per cent stake in Suven Pharmaceuticals from the Jasti family for ₹6,313 crore, inking one of the largest pharma deals in recent years.
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