Lupin is in the news today, positive news and the stock price has reacted accordingly. From Monday’s close of Rs.735.95, the stock opened at Rs.749.20 and went to rise over 3% to hit an intraday high at Rs.759.15. Market cap stands at Rs.33,450 crore.
The company announced that it has entered into a definitive agreement for the sale of its entire stake in its Japanese subsidiary, Kyowa Pharmaceutical Industry Co to Japan-based private equity firm Unison, for an enterprise value of Rs.3,702 crore.
The company expects to close the deal before 31st March 2020.
As per the terms of the deal, Lupin’s subsidiary Nanomi B.V. will divest its entire 99.82% stake in Kyowa to Unison’s entity Plutus for an enterprise value of JPY 57,361 million, subject to closing adjustments.
The company said that expects the transaction to be EPS accretive and will significantly strengthen the consolidated balance sheet of the Company. The post transaction impact on the consolidated balance sheet is as follows:
- Net debt of the Company will stand at Rs.1129 crore v/s Rs.4362 crore as at 30th Sept 2019.
- Net debt to equity ratio shall improve to 0.08 v/s 0.32 as at September 30, 2019