Shares of Mankind Pharma snapped an 8-session losing streak on Thursday after the pharma major informed exchanges that it completed the acquisition of Bharat Serums and Vaccines Ltd (BSV) for ₹13,768 crore. The company has acquired 100% stake in BSV, which will be funded through a combination of internal accruals and external debt, arranged through non-convertible debentures (NCDs) and commercial papers. The strategic acquisition will bolster Mankind's position in the Indian women's health and fertility drug market and emerging markets.
Ending 8-session downtrend, Mankind Pharma edged higher in opening trade, gaining as much as 0.5% to ₹2,543.70 on the BSE, while the market capitalisation rose to ₹1 lakh crore. The stock was swinging between gains and losses at the time of reporting.
The pharma heavyweight has witnessed some correction after it touched an all-time high of ₹2,839 on October 14 as investors resorted to profit booking at higher levels. The stock has fallen nearly 11% from its record high in the past 8 sessions.
In the last one year, Mankind Pharma shares have risen 46%, while it climbed over 5% in six month period. In the calendar year 2024, the pharma stock has added 27%, whereas it lost nearly 8% in a month.
In an exchange filing last night, Mankind Pharma said that the company and its wholly owned subsidiary, Appian Properties Private Limited, has completed the acquisition of BSV on October 23, 2024, as per the terms and conditions of the share purchase agreement signed on July 25, 2024.
“Post completion of the aforesaid acquisition, BSV has become a wholly owned subsidiary of the Company,” it says in the BSE filing.
As per the company, the acquisition will position Mankind Pharma as a market leader in the Indian women's health and fertility drug market alongside access to other high entry barrier products in the critical care segment with established complex R&D tech platforms.
“BSV’s acquisition marks a pivotal moment for Mankind Pharma. Their established specialty R&D tech platforms with complex portfolio perfectly aligns with our vision to expand into high entry barrier portfolio,” says Rajeev Juneja, Vice-chairman and Managing Director, Mankind Pharma.
“We warmly welcome BSV’s 2,500+ members to our Mankind family adding a new chapter to our exciting journey and setting the stage for accelerated growth,” he says.
Early this month, the Competition Commission of India had cleared the Mankind Pharma-BSV deal, which was executed between the two parties in July this year. In July, Mankind Pharma had executed a share purchase agreement with private equity firm Advent International for acquisition of its stake in BSV. As part of the deal, the company inked a pact with Ansamira Limited and Miransa Limited (affiliates of funds managed by Advent International), BSV, and certain minority shareholders - Bhaskar Iyer and Abhijit Mukherjee.
The exchange filing shows that the deal will be financed through internal accruals and external debt, which the company “may consider to retire, a portion of the debt through a potential equity raise, which is already approved by the shareholders”.
“This EBITDA margin-accretive acquisition aligns with Mankind’s goal of maintaining a Net Debt to EBITDA ratio below 2x by FY26, reinforcing its commitment to sustainable growth and financial discipline,” the release noted.
Early this month, Mankind Pharma’s board approved a fundraising plan of up to ₹10,000 crore and the transfer of its Over-the-Counter (OTC) business undertaking to its wholly owned subsidiary, Mankind Consumer Products (MCPPL). Mankind Pharma’s consumer products portfolio includes several trusted brands Manforce, HealthOK, Prega News, AcneStar, Unwanted and Gas-O-Fast across categories such as wellness, hygiene, and personal care products. The move is part of Mankind Pharma’s broader strategy to enhance its focus on the consumer business, which currently contributes 7% to the company's overall revenue.
The Delhi-based pharma company plans to raise up to ₹10,000 crore via issuance of non-convertible debentures and commercial papers. It will issue 5 lakh rupee-denominated secured, rated and listed NCDs with a nominal value of ₹1 lakh each totalling ₹5,000 crore. The company will also issue listed and rated commercial paper having a face value worth ₹5,000 crore.
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