Global private equity major Advent International firm Suven Pharmaceuticals has got board approval for merger of the unlisted CDMO and API platform Cohance Lifesciences, which too is a part of Advent portfolio, with it, in an all equity deal.
Upon the scheme becoming effective, Cohance shareholders will be issued shares of Suven at the ratio of 11 shares of Suven for every 295 shares of Cohance, based on the swap ratio. The new shares of Suven so issued will be traded on NSE and BSE. Advent entities shall own around 66.7% and public shareholders rest of the combined entity (preESOP dilution).
The transaction is expected to conclude over the next 12-15 months subject to shareholder and regulatory approvals, Suven said on Thursday.
The merger will strengthen Suven’s CDMO industry leadership position with niche capabilities and scale benefits and establish its position as a diversified CDMO and API leader in India. The merged entity is expected to be amongst leading integrated CDMO players in India, Suven said.
On the costs side, the benefits include sourcing materials through common vendors, cost optimisation across the platform, potentially lower investments in general and administrative expenses and sharing of best practices, Suven said. The company’s shares closed 1.9% lower at ₹630.90 apiece on the BSE.
For the nine months ended December 2023, Cohance had total assets of ₹2,487.4 crore, ₹912.9 crore turnover, including other income of ₹20.99 crore and net worth of ₹1,399.5 crore.
In December 2022, announcing plans to acquire a majority stake in Suven, Advent said post the acquisition it intends to explore merger of Suven with Cohance Lifesciences to build a leading end-to-end CDMO and merchant API player servicing the pharma and specialty chemical markets.
On the proposed merger of Cohance, Board Member of Suven and Managing Director, Advent International Pankaj Patwari said, “We are just starting on the integrated CDMO journey and quite excited to build a global leader in the space. With this combination, we will have a solid base for each of our three engines and we will invest behind each one of them, both organically and inorganically, thereby consolidating the CDMO space.” Suven said the three engines of growth were pharmaceutical CDMO; specialty chemical CDMO and API, including formulations.
“This is a transformative step in Suven’s journey of growth and building a respected integrated CDMO player,” said Annaswamy Vaidheesh, Executive Chairman of Suven.
