Piramal Enterprises said on Thursday that its board has approved the demerger of its pharmaceuticals business and simplification of its corporate structure to create two listed entities in financial services and pharmaceuticals. The pharma business will be vertically demerged from Piramal Enterprises and consolidated under Piramal Pharma, the company said in a regulatory filing.
Following the demerger, Piramal Pharma will become one of the largest pharmaceutical firms listed on BSE and NSE.
“In consideration of the demerger, Piramal Pharma Ltd (PPL) shall issue 4 fully paid-up equity shares of PPL of Rs 10 each to the shareholders of PEL for every 1 fully paid-up equity share in PEL having a face value of Rs 2 each held by them, in accordance with the Share Entitlement Ratio,” Piramal Enterprises Ltd (PEL) said.
Two operating subsidiaries wholly-owned by Piramal Pharma will also be amalgamated with Piramal Pharma Ltd to further simplify the pharma corporate structure.
“The amalgamation of PHL Fininvest Pvt Ltd with PEL will create a listed non-banking financial services (NBFC) entity. The merged housing finance company, post DHFL acquisition, will remain a 100% subsidiary of PEL,” the filing said.
Ajay Piramal, Chairman of Piramal Group said that the company has grown multi-fold with diverse businesses under one listed holding company structure over the years. The board approved the demerger and simplification of their corporate structure in line with their strategy.
“Piramal Pharma will be a large India-listed pharma company with proven capabilities in contract development and manufacturing, global distribution of complex hospital generics, and a large geographic footprint in the consumer products market in India,” he added.
PPL’s complex hospital generics and India consumer healthcare businesses are well positioned with differentiated products and business models, Piramal said
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