Strides Arcolab has completed sale of its Agila Specialties Division to Mylan for a total consideration of up to $1.75 billion. Since the initial announcement of this transaction the Board of Directors approved final transaction terms to include the following: A hold back of $ 250 million contingent upon satisfaction of certain regulatory conditions.
Consequent to the warning letter received by the company for one of its units in Bangalore, Strides has agreed to a hold back of $250 million, which will be contingent upon satisfaction of certain regulatory conditions related to the injectable facilities in India. The company expects those contingent conditions will be satisfied sometime in 2014.
Since the initial announcement of this transaction, Strides now expects an additional expenditure of $150 million. This includes cost towards acquisition of additional assets from its erstwhile partners and an estimated remediation cost related to its regulatory commitments post the warning letter.
Arun Kumar, Founder and Group Chief Executive Officer said, “We are delighted with the conclusion of this transaction and are confident that Agila will play a significant role in Mylan’s growth strategy to become a global injectable leader. I am personally delighted that Mylan’s passion for its people will augur well for all the 1800 plus employees of Strides Group who are becoming part of the Mylan family with this acquisition”.
The company will release its final distribution details post the board meeting on December 10, 2013.
Jefferies International acted as exclusive financial advisor to Strides Arcolab on the sale of Agila. Moelis & Company acted as independent financial advisor to the Board of Strides Arcolab and also provided a fairness opinion in connection with the transaction.” Herbert Smith Freehills and DSK Legal acted as the company’s legal counsels on the transaction.
EP News Bureau – Mumbai