Biocon Biologics Limited (BBL) on Wednesday announced that it has entered into a definitive agreement with Eris Lifesciences (Eris) for the divesture of its Dermatology and Nephrology branded formulations business units in India that mostly comprised of its legacy small molecules’ brands.
The transaction is a ‘Slump Sale’ that will enable a seamless transfer of the product brands and employees associated with these businesses.
“Total transaction value of the divestment is INR 3,660 million, inclusive of working capital conveyed as part of the deal, and represents an accretive multiple of 4x on Revenues and 22x on EBITDA. Post deal close, over 120 employees of the two business units are expected to transition to Eris, ensuring continuity for both employees and patients. The divestiture is expected to close by the end of Nov 2023, subject to customary closing conditions,” the company said in a statement.
The divestment of the non-core branded formulations business units in India is in line with BBL’s strategy to sharpen focus on core therapy areas as a fully integrated biosimilars company.
“This divesture of non-core assets allows Biocon Biologics to unlock value within our Branded Formulations portfolio in India and sharpen focus on our core therapy areas like Diabetes, Oncology and Immunology. We believe that Eris Lifesciences is well positioned to build further on the Dermatology and Nephrology franchise in India. Biocon Biologics remains committed to a successful transition of employees of these business units, our product brands, and customers to ensure continuity for patients,” Shreehas Tambe, CEO & Managing Director, Biocon Biologics, said.
For Biocon Biologics, this move reaffirms its commitment to strengthen the core, accelerate growth and invest in the future. Biocon Biologics remains focused on making a meaningful difference to healthcare and patients worldwide by enabling affordable access to lifesaving biosimilars, it claimed.
“We have successfully demonstrated our ability to turn around and create value in acquired businesses. The acquisition of Biocon Biologics’ Nephrology and Dermatology Branded Formulations businesses in India is in-line with our strategic goals as well as our capital allocation framework. We are very happy to welcome domain experts in Nephrology and Dermatology from Biocon. I look forward to all of us working together to build a large franchise that will deliver immense value to patients. I am confident that this acquisition will deliver value to shareholders in line with the deals we have done in FY23 and prior,” Amit Bakshi, Chairman & Managing Director of Eris Lifesciences Ltd., said in a statement.
