Report says Cipla's promoters in talks to sell stake to PE firms; pharma co says 'unaware'
Cipla’s market capitalisation is over $10 billion, a 25 per cent stake sale would require a large investment of over $2.5 billion.
- Jul 27, 2023,
- Updated Jul 27, 2023 4:41 PM IST
Pharma major Cipla's promoters on Thursday clarified that it is not trying to sell a portion of their total holding in the company to major private equity players.
Earlier in the day, CNBC TV18 reported that company promoters are in talks with some major PE firms and have hired an investment bank to advise it on the deal with prospective buyers -- Blackstone, Baring Asia, among others.
At present, the promoters of Cipla own a 33.47 per cent stake in the company.
“Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirement) Regulations 2015 (Listing Regulations), we hereby clarify that the Company is not aware of any event that requires disclosure under Listing Regulations. The company will make appropriate disclosure in compliance with the Listing Regulations as and when any such requirement arises,” the company said in a regulatory filing at the bourses.
Earlier, the report quoting sources said the promoters are evaluating options for a strategic investor to come on board to revamp future strategy to enhance capital allocation and operational efficiency to improve return metrics.
The sources further added that the company is trying to create a clear road map on succession in the firm after its second generation promoters, Chairman YK Hamied and Vice Chairman MK Hamied.
“Succession issue has been a long-standing concern at Cipla, the company needs a clear leadership plan. It has been often seen as a takeover candidate for this reason," one of the sources said.
Cipla’s market capitalisation is over $10 billion, a 25 per cent stake sale would require a large investment of over $2.5 billion.
Shares of pharmaceutical major Cipla zoomed nearly 9 per cent on July 27 after the company reported a 45 per cent hike in net profit, which stood at Rs 995 crore. The drugmaker reported healthy growth across its key India, the US and South Africa markets.
At 2 PM, the stock rose 9.67 per cent and was trading at Rs 1,172.00 on BSE.
Cipla’s total revenue stood at Rs 6,329 crore for the quarter under review, up close to 18 per cent from the corresponding period last year. Its one-India business was buoyed by branded prescription, trade generics and consumer health.
The company’s US business reported the highest ever revenue of $222 million, registering a growth of 43 per cent YoY growth driven by robust momentum in differentiated portfolios.
Cipla’s R&D investments rose 27 per cent YoY to Rs 349 crore or 5.5 per cenr of sales, driven by continued progress of clinical trials on key pipeline assets and other developmental efforts.
Also read: Rs 23 to Rs 186: This power stock turned into a multibagger in three years; trading near record high
Pharma major Cipla's promoters on Thursday clarified that it is not trying to sell a portion of their total holding in the company to major private equity players.
Earlier in the day, CNBC TV18 reported that company promoters are in talks with some major PE firms and have hired an investment bank to advise it on the deal with prospective buyers -- Blackstone, Baring Asia, among others.
At present, the promoters of Cipla own a 33.47 per cent stake in the company.
“Pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirement) Regulations 2015 (Listing Regulations), we hereby clarify that the Company is not aware of any event that requires disclosure under Listing Regulations. The company will make appropriate disclosure in compliance with the Listing Regulations as and when any such requirement arises,” the company said in a regulatory filing at the bourses.
Earlier, the report quoting sources said the promoters are evaluating options for a strategic investor to come on board to revamp future strategy to enhance capital allocation and operational efficiency to improve return metrics.
The sources further added that the company is trying to create a clear road map on succession in the firm after its second generation promoters, Chairman YK Hamied and Vice Chairman MK Hamied.
“Succession issue has been a long-standing concern at Cipla, the company needs a clear leadership plan. It has been often seen as a takeover candidate for this reason," one of the sources said.
Cipla’s market capitalisation is over $10 billion, a 25 per cent stake sale would require a large investment of over $2.5 billion.
Shares of pharmaceutical major Cipla zoomed nearly 9 per cent on July 27 after the company reported a 45 per cent hike in net profit, which stood at Rs 995 crore. The drugmaker reported healthy growth across its key India, the US and South Africa markets.
At 2 PM, the stock rose 9.67 per cent and was trading at Rs 1,172.00 on BSE.
Cipla’s total revenue stood at Rs 6,329 crore for the quarter under review, up close to 18 per cent from the corresponding period last year. Its one-India business was buoyed by branded prescription, trade generics and consumer health.
The company’s US business reported the highest ever revenue of $222 million, registering a growth of 43 per cent YoY growth driven by robust momentum in differentiated portfolios.
Cipla’s R&D investments rose 27 per cent YoY to Rs 349 crore or 5.5 per cenr of sales, driven by continued progress of clinical trials on key pipeline assets and other developmental efforts.
Also read: Rs 23 to Rs 186: This power stock turned into a multibagger in three years; trading near record high