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Sanofi India Ltd updates on divestment of Soframycin® and Sofradex® businesses

Posted On : 2021-11-26 15:16:04( TIMEZONE : IST )

Sanofi India Ltd updates on divestment of Soframycin® and Sofradex® businesses

The Board of Directors of Sanofi India Limited (the Company) at its meeting held on 5th February 2021 had reviewed the proposed plan of the Sanofi Group to sell some of its old brands along with their trademarks, which are owned by Sanofi Group. These include brands Soframycin® and Sofradex®, which are manufactured (through a third-party manufacturing arrangement) and distributed by the Company. The Board had noted that upon completion of the sale by Sanofi Group, the Company would no longer be entitled to distribute products under those brands in India. The revenue of the Company attributable to these brands represented 2.6% of the total sales of the Companyfor the for FY 20 and the business contributed 0.2% of the networth of the Company as on 31st December, 2020.

Sanofi Group has announced that the Board of Directors of the Company that it has decided to enter into a transaction in pursuance of the above-mentioned plan with Encube Ethicals Private Limited (Encube). The transaction involves a transfer of the Soframycin® and Sofradex®, brands, trademarks and associated technical know-how / manufacturing dossiers (registered IP) to Encube and on fulfilment of this transaction Encube would have the right to exclusively sell and distribute these products in the territories of India and Sri Lanka.

The Board noted that the registered IP is owned by Sanofi Group, the Board also noted that the Company holds certain assets namely marketing intangibles, customer lists / database, trade channel knowledge / wholesaler lists, vendor / supplier data-base, pharmacovigilance / medical database that are related to this distribution business conducted by the Company (collectively called unregistered IP) and product inventory. As part of this transaction, Encube has also expressed its willingness to purchase the unregistered IP and product inventory from the Company. This asset sale does not involve transfer of any employees and is not expected to create any disruption in supplies to customers and patients.

The Board has considered the valuation reports issued by Deloitte and BDO on the value of the unregistered IP and product inventory which have been reviewed by the Audit Committee and the Board of the Company and accordingly has approved the transfer of this unregistered IP and product inventory to Encube at its meeting held on 25th November, 2021 for a consideration of approximately Rs. 125 crores, subject to working capital adjustments, if any, as on the Closing Date and on the terms set out in an Asset Purchase Agreement which is to be entered into by the Company and Encube on 1st December, 2021. Completion of the transaction is subject to certain conditions and is expected to close within the next 3 months.

Shares of Sanofi India Limited was last trading in BSE at Rs. 8176.55 as compared to the previous close of Rs. 8128.55. The total number of shares traded during the day was 159 in over 131 trades.

The stock hit an intraday high of Rs. 8190.60 and intraday low of 8094.05. The net turnover during the day was Rs. 1292161.00.

Source : Equity Bulls


SanofiIndiaLimited INE058A01010 Pharmaceuticals Soframycin Sofradex Sale EncubeEthicals