Aurobindo Pharma to divest Natrol to New Mountain Capital

Aurobindo Pharma has reached a definitive agreement to sell Natrol LLC., a wholly owned subsidiary of Aurobindo Pharma USA, Inc., to an affiliate of New Mountain Capital to combine with Jarrow Formulas.

The all-cash transaction is valued at USD 550 Million (or INR 4,048 Cr at the current exchange rate). Subject to customary closing conditions and regulatory approvals, the transaction is expected to close by January 2021.

Natrol's annual sales for the 12 months ended March 31, 2020 was about USD 157 Million.

Following the acquisition of the assets of Natrol by Aurobindo Pharma in December 2014, Natrol has been a consistently profitable business, growing on all fronts under Aurobindo's ownership.

"Aurobindo is committed to evaluating and concluding strategic options towards focused portfolio enhancement with the ultimate objective of enhancing stakeholder values. We are pleased to sell the Natrol business to an outstanding private equity player, who could focus additional resources to grow Natrol, its products and brands further."

"On behalf of Aurobindo Group, my heartful thanks to all stakeholders including employees, who have supported in acquiring and bringing Natrol to a growth path in the past 6 years," said Mr. N. Govindarajan, Managing Director, Aurobindo Pharma Limited. He also said "Proceeds from Natrol's divestiture will be used to reduce debt and other new strategic initiatives."

Jefferies served as the sole financial advisor to Aurobindo, and Sullivan & Cromwell LLP acted as legal counsel to Aurobindo.

Shares of AUROBINDO PHARMA LTD. was last trading in BSE at Rs.783.05 as compared to the previous close of Rs. 782.45. The total number of shares traded during the day was 143789 in over 4705 trades.

The stock hit an intraday high of Rs. 788.05 and intraday low of 773.2. The net turnover during the day was Rs. 112452062.

Source : Equity Bulls

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