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Cipla share price climbs 2% as firm plans to buy stake in GoApptiv

Following the latest deal, Cipla share price rose 1.65% intraday to the day's high of Rs 650.50 compared to its earlier close of Rs 639.90 on BSE. The stock has gained 2.19% in the last 2 sessions.

twitter-logoBusinessToday.In | June 10, 2020 | Updated 14:44 IST
Cipla share price climbs 2% as firm plans to buy stake in GoApptiv
Cipla share price is trading higher than 5, 20, 50, 100 and 200-day moving averages

Share price of pharma firm Cipla rose almost 2% in Wednesday's trade after the firm announced that it would buy 21.85% stake in GoApptiv on a fully diluted basis in all-cash consideration for Rs 9 crore.

Through an equity investment, representing 21.85 per cent stake in GoApptiv, the drug firm will strengthen its partnership with the firm so as to enable the widening reach of its key brands in the tier-3 plus towns, Cipla said.

Following the latest deal, Cipla share price rose 1.65% intraday to the day's high of Rs 650.50 compared to its earlier close of Rs 639.90 on BSE. The stock has gained 2.19% in the last 2 sessions.

Cipla share price is trading higher than 5, 20, 50, 100 and 200-day moving averages. Market capitalisation of the firm stood at Rs 52,012 crore as of today's session.

Cipla stock has risen 0.57% in one week, 9% in one month and 34.83% since the beginning of the year. The stock has given 16.51% returns in one year.

The acquired firm has a turnover of Rs 19.03 crore as of March 31, 2020, as per its provisional financial statements. The entire transaction is expected to close by October 31

Cipla said through this equity investment, the pharma manufacturer will strengthen its partnership with GoApptiv so as to enable the widening reach of its key brands in the Tier 3+ towns through GoApptiv's solutions for end-to-end brand marketing and channel engagement.

The company is acquiring in two phases, with the first stage of share purchase worth Rs 5.80 crore and the second stage worth Rs 3.2 crore.

In its first stage of investment, Cipla will subscribe 15,392 compulsory convertible preference shares. A purchase of 6,927 equity shares is expected to be closed within 30 days from the execution date, the filing added.

The filing later added the second stage-subscription of 12,314 compulsorily convertible preference shares is expected to close by October 31, 2020.

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