Novartis India promoter to sell entire 70.68% stake, triggering open offer at Rs 860.64 apiece

Shares of Novartis India Ltd will be in focus on Friday after promoter Novartis AG agreed to sell its entire 70.68 per cent stake in the company to WaveRise Investments, ChrysCapital Fund X and Two Infinity Partners, along with ChrysCapital X, LLC and OceanEdge Investments Limited. The acquisition triggered an open offer by the buyers to acquire up to 26 per cent stake.

The open offer price of Rs 860.64 is at a 3.64 per cent premium over Thursday’s closing price of Rs 830.45 apiece for Novartis India Ltd. For the purpose of the transaction, Novartis India Ltd proposed to enter into a company covenant and warranty deed with the seller and the acquirers. Accordingly, at its meeting, the board of directors approved the execution of the covenant and warranty deed, following which it was executed by the company. Promoter Novartis AG is selling 1,74,50,680 shares, representing 70.68 per cent of its stake. 

“The company has provided certain customary warranties on a non-recourse basis to the acquirers in relation to the company and its business. The company has agreed to provide reasonable assistance and information required by the acquirers in connection with the mandatory open offer made by the acquirers to the public shareholders of the company,” Novartis said.

Novartis India said it has agreed to change its name to remove all references to the seller group within 120 days from completion of the transaction.

Novartis India said it has undertaken certain customary post-closing obligations, including completing the relevant regulatory filings in connection with the transaction.

Novartis India open offer
Under the open offer, acquirers have announced acquisition of up to 64,19,608 fully paid-up equity shares of face value of Rs 5 each from public shareholders of Novartis India Limited, representing 26 per cent of the ‘Voting Share Capital’ at a price of Rs 860.64 apiece, aggregating to a total consideration of up to Rs 552,49,71,429  (Rs 552.49 crore) payable in cash, subject to the terms and conditions mentioned in the public announcement.