Home-grown drug maker Mankind Pharma has announced the slump sale of the Over the Counter (OTC) business of the company to wholly-owned subsidiary company which is yet to be named.
According to media reports, the Manforce condom maker has said that it has been evaluating its position, business strategy and exploring various options to grow the OTC business with a more focus.
The proposed subsidiary will be incorporated to carry out “the business of trading and manufacturing of different consumer healthcare products predominantly over-the-counter drugs”.
According to a report by The Hindu Businessline, it will have an initial paid-up capital of Rs.5 crore and a further investment of up to Rs.250 crore in one or more tranches.
Reportedly, the sale will be effective on or before October 1 or any other date as may be mutually agreed. According to media report, the sale will enable the company to remain “agile in the marketplace” and create a stronger brand recall for the vertical.
“Slump sale of the OTC business of the company to (a) wholly-owned subsidiary company proposed to be incorporated with the name of Mankind Consumer Products Pvt Ltd or any other name as approved by Ministry of Corporate Affairs.,” the company said in a notification.
Some of the key OTC products by Mankind Pharma include the anti-inflammatory and anti-bacterial product AcneStar, the HealthOk multivitamin tablets, the oral contraceptive brand Unwanted and the antacid Gas-O-Fast. It also includes its Consumer Healthcare vertical.
The OTC vertical had a revenue of ₹704 crore, or 8.7 per cent of the company’s reported revenue of ₹8,127 crore in FY23. Net worth (of OTC business) stood at March 31 at ₹155 crore or 2 per cent of Mankind Pharma which stood at ₹7,783.91 crore in FY23.
The company also said “rationalising its structure will provide opportunities to enhance stakeholders’ value by creating sustainable and quality OTC business.”
“The Company will continue to have business operations with the proposed incorporated entity on arm’s length basis,” it further added.
