SOLARA ACTIVE PHARMA SCIENCES LIMITED — Regulatory Filings 2021

Nov 11, 2021

Communication Address: Solara Active Pharma Sciences Limited Batra Centre No. 28. Sardar Patel Road. Post Box 2630 Guindy. Chennai - 600 032. India Tel: +91 44 43446700. 22207500 Fax: +914422350278 E-mail : investors@solara.com www.solara.co.in

November 11, 2021

BSE Limited Phiroze Jeejeebhoy Towers Dalal Street, Mumbai - 400 001

Scrip Code: 541540

National Stock Exchange of India Limited

Exchange Plaza, Bandra-Kurla Complex Sandra (E), Mumbai - 400 051

Scrip Code: SOLARA

Dear Sirs,

Sub: Outcome of meeting of the Board of Directors of Solara Active Pharma Sciences Limited ("Company") held on 11th November 2021 - Disclosure under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") read with SEBI Circular No. CIR/CFD/CMD/4/2015 dated September 09, 2015, as amended from time to time.

In terms of Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations") read with SEBI Circular bearing reference number CIR/CFD/CMD/4/2015 dated September 9, 2015, we hereby submit the outcome of the meeting of the Board of Directors ("Board") of Solara Active Pharma Sciences Limited ("Solara" or the "Company") held on 11th November 2021. Based on the recommendations of the Audit Committee and the Committee of Independent Directors, the Board has considered and approved a Composite Scheme of Amalgamation (Merger by Absorption) cum Demerger and Arrangement (the "Scheme") amongst Hydra Active Pharma Sciences Private Limited and Aurore Life Sciences Private Limited and Empyrean Lifesciences Private Limited and Solara under Sections 230 to 232 and Section 66 of the Companies Act, 2013 read with other applicable provisions and the Rules framed thereunder ("the Act"). Further the Board has given authorisation to file the Scheme along with relevant disdosures, documents, certifications, and undertakings with the stock exchanges.

The Scheme, inter alia, provides for:

• a) Redemption of 0.1% Redeemable Preference Shares of Rs. 1,000 each issued by Hydra Active Pharma Sciences Private Limited ("Hydra" or "Amalgamating Company 1" or "Transferor Company 1 ").
• b) Subject to satisfactory fulfilment and accomplishment of (a) above, amalgamation of Transferor Company 1 with Aurore Life Sciences Private Limited ("Aurore Life Sciences" or "Amalgamated Company 1" or "Transferee Company 1" or "Demerged Company")
• c) Subject to satisfactory fulfilment and accomplishment of (a) and (b) above, demerger of the Demerged Undertaking (API Business Undertaking) from Demerged Company into Solara Active Pharma Sciences Limited ("Solara" or "Resulting Company" or "Amalgamated Company 2" or "Transferee Company 2")
• d) Subject to satisfactory fulfilment and accomplishment of (a), (b) and (c) above, amalgamation of Empyrean Lifesciences Private Limited ("Empyrean" or the "Amalgamating Company 2" or "Transferor Company 2") with the Transferee Company 2.

Communication Address: Solara Active Pharma Sciences Limited Batra Centre No. 28. Sardar Patel Road. Post Box 2630 Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax: +91 44 22350278 E-mail : investors@solara.com www.solara.co.in

The Scheme is subject to the fulfilment of certain conditions including receipt of approvals of shareholders and creditors of companies involved and approval of other regulatory authorities as may be required, including those of the National Stock Exchange of India Limited, BSE Limited, Securities and Exchange Board of India and the National Company Law Tribunal, having jurisdiction over the respective companies ("NCL T").

Advisors for the proposed transaction are Transaction Square LLP, Share Exchange Ratio Report issued by Niranjan Kumar, Registered Valuer - Financial Securities or Assets (affiliate of Transaction Square LLP), Fairness opinion on the Share Exchange Ratio Report by ICICI Securities Limited and Legal advisors to the proposed Scheme are Anagram Partners and DSK Legal.

Please find enclosed Annexure 1 containing details as per Regulation 30 of the Listing Regulations read with Circular CIR/CFD/CMD/4/2015 dated September 9, 2015.

We request you to take the same on record.

Thanking you, Yours faithfully, For Solara Active Pharina Sciences Limited

S. Murali Krishna Company Secretary

Communication Address: Solara Active Pharma Sciences Limited Batra Centre No. 28. Sardar Patel Road. Post Box 2630 Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax: +91 44 22350278 E-mail : investors@solara.com www.solara.co.in

Annexure-1

Disclosures regarding the proposed Composite Scheme of Amalgamation (Merger by Absorption) cum Demerger and Arrangement

Sr.	Particulars	Details
No.
a)	Name of the entities forming	This Scheme is a Composite Scheme of Amalgamation (Merger by
	part of the Scheme, details in	Absorption) cum Demerger and Arrangement ("Scheme")
	brief such as size, turnover,	involving:
	etc
		Hydra Active Pharma Sciences Private Limited ("Hydra" or 1. "Amalgamating Company 1" or "Transferor Company 1").
		Aurore Life Sciences Private Limited ("Aurore Life Sciences" 2. or "Amalgamated Company 1" or "Transferee Company 1"
		or "Demerged Company") 3. Empyrean Lifesciences Private Limited ("Empyrean" or "Amalgamating Company 2" or "Transferor Company 2")
		4.	Solara Active Pharma Sciences Limited ("Solara" or "Resulting
			Company" or "Amalgamated Company 2" or "Transferee
		Company 2"). It is Listed on BSE and NSE.
		Set out below is the net-worth and total income for the 6 months period ended 30th September 2021 of the entities involved in the
		Scheme -	(Atnount in INR Crores)
		Particulars	Total Income	Net Worth
			(Standalone)	(Standalone)
		Solara*	816.49	1667.01
		Aurore Life	250.82	219.63
		Sciences
		Empyrean	3.00	(5.13)
		Hydra	0.11	126.51
		* Limited reviewed by the Auditor
b)	Whether the transaction	The proposed Scheme does not fall within the purview of related
	would fall within the related	party transactions in terms of exemption granted under General
	transactions? If Yes, whether	Circular No. 30/2014 dated 17th July 2014 issued by the Ministry
	the same is done at "Arm's	of Corporate Affairs since the Scheme is under Sections 230 to 232
	Length"	of the Companies Act, 2013 and is subject to the sanction of the National Company Law Tribunal and provisions of Section 188 of
		the Companies Act, 2013 are not applicable.

Communication Address: Solara Active Pharma Sciences Limited Batra Centre No. 28. Sardar Patel Road. Post Box 2630 Guindy . Chennai - 600 032. India Tel : +9 I 44 43446700. 22207500 Fax: +91 44 22350278 E-mail : investors@solara.com www.solara.co.in

		The companies involved in the Scheme have following relationship with each other- • Karuna Business Solutions LLP is a common promoter in Solara and Hydra holding 7.83% and 29.75% stake in respective companies. • Hydra holds 61.65% stake in Aurore Life Sciences. • Empyrean is a wholly owned subsidiary of Aurore Life Sciences. Pursuant to the scheme, Solara would discharge consideration by way of issue of equity shares as recommended by the Board relying on the Report on recommendation of fair share exchange ratio obtained from Niranjan Kumar, Registered Valuer - Securities or Financial Assets, a Registered Valuer and Fairness opinion on the said valuation report is obtained from ICICI
c)	Area of of the Business	Company	1-----=----'"----+---------------- Business
	entity(ies)	Solara	- - ---4 of Solara engaged the business is in development of Active manufacturing and Pharmaceutical Ingredients ('API') and also offers Contract Manufacturing and Development Services to the global companies.
		Aurore Life Sciences	Aurore Life Sciences engaged the is in business of developing wide range of generic pharmaceutical products.
		Empyrean	Empyrean is a wholly owned subsidiary of Aurore Life Sciences and is engaged in the pharmaceutical business.
		Hydra	Hydra is engaged in pharmaceutical business through its subsidiary company Aurore Life Sciences where in it holds 61.65% stake.
d)	Rationale for the Scheme	The Transferor Company 1, Transferor Company 2, Demerged Company and Transferee Company 2 are engaged in similar lines of business and complement each other. With an intent to expand the business and achieve larger product portfolio, economies of scale, efficiency, optimization of logistic and distribution network and other related economies by consolidating the business operations being managed by different management teams, the of Directors of the Board all the Companies propose to

Communication Address: Solara Active Pharma Sciences Limited Batra Centre No. 28. Sardar Patel Road. Post Box 2630 Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax: +91 44 22350278 E-mail : investors@solara.com www.solara.co.in

consolidate the business of Transferor Company 1, Transferor Company 2 and Demerged Undertaking of the Demerged Company with the Transferee Company 2. The proposed Scheme would inter alia have the following benefits: 1. Enable the consolidation of the API business of the Demerged Company and Transferor Company 2 with the Transferee Company 2 and would create one of the largest API players in the industry and will facilitate in focused growth, operational efficiency, integration synergies and better supervision of the business. 2. Enhance business potential and increased capability to offer a wider portfolio of products with a diversified resource base and deeper client relationships. 3. Significantly de-risk operations with the combined entity having seven manufacturing facilities, three Research & Development Centres and footprint in 75 + countries enabling a wider market reach and customer offerings. 4. Improve organizational capability and leadership, arising from the pooling of human capital who have the diverse skills, talent and vast experience to compete successfully in an increasingly competitive industry. 5. Enable greater access to different market segments in conduct of its business and addition of new products in the portfolio would improve the competitive position of the combined entity. 6. Add new Research and Development capabilities, new products pipeline and capabilities and would also bring in large Contract Research and Manufacturing business innovator relationship. 7. Result in financial resources being efficiently merged and pooled leading to more effective and centralized management of funds, greater economies of scale, stronger base for future growth and reduction of administrative overheads. 8. Further, the synergies arising out of the consolidation of business will lead to enhancement of net worth of the combined business and enhancement in earnings and cash flow would optimize the value of the Transferee Company 2 and enhance the shareholder's value. 9. Moreover, Lhe Sd1eme is expected to increase the longterm value for all the shareholders of the Transferor Company 1, Transferor Company 2, Demerged Undertakinq of Demerqed Company and Transferee

Communication Address: Solara Active Pharma Sciences Limited Batra Centre No. 28. Sardar Patel Road. Post Box 2630 Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax: +91 44 22350278 E-mail : investors@solara.com www solara co in

e) f) g) Brief details of the division to be demerged Turnover of the demerged division and as percentage to the total turnover of the listed entity In the immediately preceding financial year/ based on financials of the last financial year; In case of cash consideration Company 2. Further, the public shareholders of the Transferee Company 2 will have an opportunity to participate in the profit and growth of the businesses of Transferor Company 1, Transferor Company 2 and Demerged Undertaking of the Demerged Company which are currently unlisted. The Demerged Undertaking comprises of the Active Pharmaceutical Ingredients ("API") Business (including investment in Empyrean) of the Demerged Company Turnover of the Demerged Undertaking for the 6 months period ended on 30th September 2021 is INR 250.82 Crores which constituted nearly 100% of the total turnover of the Demerged Company for the aforesaid period. There is no cash consideration involved in the Scheme. amount or otherwise share Below is the share exchange ratio for the Scheme: exchange ratio; For Amalgamation of Transferor Company 1 with the Transferee Company 1 "6,23,41,667 (Six Crore Twenty Three Lakhs Forty One Thousand Six Hundred and Sixty Seven) fully paid up equity shares of the face value of INR 10 (Rupees Ten Only) each of Transferee Company 1 shall be issued and allotted as fully paid up equity shares to the equity shareholders of Transferor Company 1, in proportion to their holding of fully paid up equity shares of the face value of INR 10 (Rupees Ten Only) each in Transferor Company 1" For Demeraer of the Demeraed Undertakina from the Demerged Company into the Resulting Company/Transferee Company 2 1,122 (One Thousand One Hundred and Twenty-Two) fully paid up equity shares of INR 10 (Rupees Ten only) each of Resulting Company, credited as fully paid up, for every 10,000 (Ten

Communication Address: Solara Active Pharma Sciences Limited Batra Centre No. 28. Sardar Patel Road. Post Box 2630 Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax: +91 44 22350278 E-mail : investors@solara.com www solara co in

		Thousand) fully paid up equity shares of INR 10 (Rupees Ten only) each of the Demerged Company held by such shareholders.
			For Amalaamation of Transferor Comoanv 2 with the
		Transferee Comoanv 2
		Pursuant to the demerger of the Demerged Undertaking from the Demerged Company into the Resulting Company/ Transferee Company 2 and upon the Scheme becoming effective, the entire issued, subscribed and paid-up share capital of the Transferor Company 2 will be held by Transferee Company 2, there shall be no issue of shares as consideration for amalgamation of the Transferor Company 2 with the Transferee Company 2.
h)	Brief details of change in shareholding pattern (if any)	Change in shareholding of Solara:
	of listed entity	Category	Pre-Scheme Post-Scheme
			No. of % share		No.of	% share
			shares	holding	shares	holding
		Promoter	1,42,03,710	39.53	2,32,40,675	49.16
		and
		Promoter
		Group
		Public	2, 17,26,057	60.47	2,40,34,968	50.84
		Non-	-	-
		Promoter
		Non
		Public Total	3,59,29, 767	100	4,72,75,643	100