Mankind Pharma shares jump 3% as drugmaker to sell OTC biz on slump sale basis
Mankind Pharma said it has been evaluating its position, business strategy and exploring various options to grow the OTC business in a more focused manner.
- Apr 2, 2024,
- Updated Apr 2, 2024 2:00 PM IST
Shares of Mankind Pharma Ltd advanced 3 per cent in Tuesday's trade after the drugmaker announced a slump sale of the Over the Counter (OTC) business of the company to wholly-owned subsidiary company that is being incorporated with the name of Mankind Consumer Products or any other name as approved by Ministry of Corporate Affairs.
Mankind Pharma said it has been evaluating its position, business strategy and exploring various options to grow the OTC business in a more focused manner. The slump sale will enable the company to remain agile in the marketplace, build wider consumer reach and will create a stronger brand recall for the OTC Business, it said.
"The company believes that rationalising its structure will provide opportunities to enhance stakeholders' value by creating sustainable and quality OTC business," Mankind Pharma said.
Following the development, the stock was trading 2.61 per cent higher at Rs 2372.90.
Mankind Pharma said the slump sale including authority to directors/ officers of the company to enter into the business transfer agreement (BTA) and other related documents to give effect to the transaction. The BTA will be executed in due course, it said.
The proposed transaction does not form part of any Scheme of Arrangement. The slump sale is being proposed to be undertaken through a Business Transfer Agreement between the Company and its wholly owned subsidiary. Further, as
the OTC Business proposed to be transferred does not meet the threshold limits of “Undertaking” in terms of Section 180(1)(a) of the Companies Act,2013. Accordingly, the provisions of section 37A of LODR Regulations are not applicable in the present case, Mankind Pharma said.
There will be no change in the shareholding pattern of the company pursuant to the proposed slump sale, Mankind Pharma said.
"The consideration would not be less than the fair market value of the OTC business determined as per Rule 11UAE of the Income Tax Rules, 1962 which will be discharged in accordance with the terms of BTA," Mankind Pharma said.
Shares of Mankind Pharma Ltd advanced 3 per cent in Tuesday's trade after the drugmaker announced a slump sale of the Over the Counter (OTC) business of the company to wholly-owned subsidiary company that is being incorporated with the name of Mankind Consumer Products or any other name as approved by Ministry of Corporate Affairs.
Mankind Pharma said it has been evaluating its position, business strategy and exploring various options to grow the OTC business in a more focused manner. The slump sale will enable the company to remain agile in the marketplace, build wider consumer reach and will create a stronger brand recall for the OTC Business, it said.
"The company believes that rationalising its structure will provide opportunities to enhance stakeholders' value by creating sustainable and quality OTC business," Mankind Pharma said.
Following the development, the stock was trading 2.61 per cent higher at Rs 2372.90.
Mankind Pharma said the slump sale including authority to directors/ officers of the company to enter into the business transfer agreement (BTA) and other related documents to give effect to the transaction. The BTA will be executed in due course, it said.
The proposed transaction does not form part of any Scheme of Arrangement. The slump sale is being proposed to be undertaken through a Business Transfer Agreement between the Company and its wholly owned subsidiary. Further, as
the OTC Business proposed to be transferred does not meet the threshold limits of “Undertaking” in terms of Section 180(1)(a) of the Companies Act,2013. Accordingly, the provisions of section 37A of LODR Regulations are not applicable in the present case, Mankind Pharma said.
There will be no change in the shareholding pattern of the company pursuant to the proposed slump sale, Mankind Pharma said.
"The consideration would not be less than the fair market value of the OTC business determined as per Rule 11UAE of the Income Tax Rules, 1962 which will be discharged in accordance with the terms of BTA," Mankind Pharma said.