Eris Lifesciences Ltd on Tuesday said it has acquired a 51% stake in the Swiss Parenterals Ltd (SPL) for ₹637.50 crore, aiming to expand its presence in the sterile injectables market.
According to a stock exchange filing, this move will increase the total equity stake of Eris and its promoter group in SPL to 70%, with the promoter group additionally buying a 19% stake for ₹237.50 crore.
The Ahmedabad-based firm expects to complete the financial aspects of the transaction by March 31, 2024. At the time of closing, it plans to pay 200 crore, and the remaining amount will be paid 12 months after the deal closes.
Eris will also issue 8% secured redeemable non-convertible debentures valued at ₹437.5 crore for 40% of SPL’s equity shares through a private placement.
Acquiring Swiss Parenterals will bolster the company’s domestic presence with a new injectables-focused branded formulations business and enhance reach in emerging markets, said Amit Bakshi, chairman and managing director, Eris Lifesciences, in a press statement.
Eris intends to take advantage of Swiss Parenterals’ international distribution networks and regulatory knowledge to start exporting oral solid dosage formulations from its own manufacturing facilities, Bakshi stated.
SPL is well-known for its strong sterile injectables business, which it operates in more than 80 emerging markets and has two facilities in Gujarat. It offers a portfolio exceeding 1,000 dossiers across more than 190 molecules and collaborates with numerous distribution partners worldwide. SPL recorded a turnover of 280.30 crore in fiscal year 2022-23 (FY23), indicating a compound annual growth rate of 6.8% over the past three years.
Earlier, Eris acquired brands from Biocon, and Oaknet brands from Glenmark and Dr. Reddy’s, marking its entry into the dermatology segment.
The company also shared its financial results for the quarter ending December 2023, showing a net profit of ₹102.73 crore, slightly higher than ₹101.86 crore in the same quarter the previous year. Its consolidated revenue from operations increased by 14.9% to 486.30 crore, compared to 423.26 crore in the third quarter of FY23.
In November last year, Eris announced the acquisition of the nephrology and dermatology segments of Biocon Biologics Ltd.’s branded formulations business in India for 366 crore.
Eris has previously ventured into new therapies through acquisitions. It entered neuropsychiatry in 2017 through the acquisition of Strides Shasun’s domestic business, and dermatology in 2022 through the acquisition of Oaknet Healthcare, followed by brand portfolios from Glenmark and Dr. Reddy’s in early 2023.
For the three months to December 2023, Eris reported a net profit of ₹102.73 crore, marginally up from ₹101.86 crore a year ago. Consolidated revenue from operations rose 15% on year to ₹486.30 crore.
Bakshi pointed out that the company’s primary domestic formulation business is experiencing sustained momentum, significant margin growth, and a strong cash flow. The Emerging Therapies segment now makes up nearly 30% of Eris’s revenue, with a 28% growth rate due to a diversified portfolio.
Over 25 active fixed-dose combination candidates are currently under development as the company enhances its R&D efforts. Additionally, the insulin business is expanding and currently generating a monthly revenue rate of 5 crore, he added.