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SOLARA ACTIVE PHARMA SCIENCES LIMITED — M&A Activity 2021
Aug 25, 2021
61842_rns_2021-08-25_b108d6ac-c1c7-4b3f-91a0-aab1fa2a066e.pdf
M&A Activity
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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 : [email protected] www.solara.co.in
25[th] August 2021
To,
BSE Limited
Listing Department 1st Floor, New Trading Ring, Rotunda Building, Phiroze Jeejeebhoy Towers, Dalal Street, Fort Mumbai - 400 001
National Stock Exchange of India Limited
Listing Department Exchange Plaza, 5th Floor, Plot No. C/1, G Block, Bandra Kurla Complex, Bandra (E), Mumbai – 400 051.
Scrip code: 541540 Name of Scrip: SOLARA Dear Sir,
Sub: Outcome of meeting of the Board of Directors of Solara Active Pharma Sciences Limited (“Company”) held on 25[th] August 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 25[th] August 2021.
Approval of the Original Scheme of Amalgamation on 9[th] April 2021
The Board of Directors of the Company in its meeting held on 9[th] April 2021 had approved the Draft Composite Scheme of Amalgamation of Aurore Life Science Private Limited (“Aurore Life Science” or “Amalgamating Company 1”), Empyrean Lifesciences Private Limited (“Empyrean” or “Amalgamating Company 2”) and Hydra Active Pharma Sciences Private Limited (“Hydra” or Amalgamating Company 3) with the Company (“Proposed Amalgamation”), based on the recommendations of the Audit Committee and the Committee of Independent Directors. The swap ratio for the amalgamation was determined by the valuer based on the financials as on 31st December 2020.
Post approval of the Board of Directors, the application was filed before the Stock Exchanges for obtaining Observation Letter to the Draft Scheme on 25[th] June, 2021. However, the National Stock Exchange vide letter dated 3[rd] August 2021 and Bombay Stock Exchange vide e-mail dated 9[th] August 2021 had asked for the valuation report of the companies based on the financials not being older than 3 months from the date of filing with the Stock Exchanges.
Solara Active Pharma Sciences Limited - CIN : L24230MH2017PLC291636 REGD. OFF: 201, Devavrata, Sector 17, Vashi Navi Mumbai - 400703. India/ Tel: 91-22-2789 2924 / 2789 3199 / Fax: 91-22-2789 2942
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 : [email protected] www.solara.co.in
In view of the same, the Company has obtained the addendum to the valuation report dated 25[th] August 2021 determining the revised swap ratio based on the Financials Statements as on 30[th] June 2021 (being not more than 3 months old) and Addendum to the Fairness Opinion dated 25[th] August 2021.
The Board has taken on record and considered the aforesaid addendum to valuation report and the addendum to the Fairness Opinion and has decided to continue with the swap ratio for the Proposed Amalgamation as approved by the Board in its meeting held on 9[th] April 2021.
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 (“ NCLT ”).
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.
This is for your information and record.
Thanking you,
Yours faithfully, For and on behalf of Solara Active Pharma Sciences Limited
Murali Krishna Company Secretary Encl: A/a
Solara Active Pharma Sciences Limited - CIN : L24230MH2017PLC291636 REGD. OFF: 201, Devavrata, Sector 17, Vashi Navi Mumbai - 400703. India/ Tel: 91-22-2789 2924 / 2789 3199 / Fax: 91-22-2789 2942
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 : [email protected] www.solara.co.in
Annexure – I
Disclosures regarding the proposed Composite Scheme of Amalgamation and Arrangement
| Sr. No. |
Particulars | Details | Details | Details | |
|---|---|---|---|---|---|
| a) | Name of the entities forming part of the amalgamation/merger, details in brief such as size, turnover, etc |
This Scheme is a Composite Scheme of Amalgamation (“Scheme”) involving: 1. Solara Active Pharma Sciences Limited (“Company” or “Solara” or “Amalgamated Company”). It is Listed on BSE and NSE; 2. Aurore Life Science Private Limited (“Aurore Life Science” or “Amalgamating Company 1”); 3. Empyrean Lifesciences Private Limited (“Empyrean” or “Amalgamating Company 2”); and 4. Hydra Active Pharma Sciences Private Limited (“Hydra” or Amalgamating Company 3). Set out below is the net-worth and total income for the Financial Year ending 31stMarch 2021 of the entities involved in the Scheme –(Amount in INR Crores) Particulars Total Income (Standalone) Net Worth (Standalone) Solara 1,645.29 1,592.78 Aurore Life Science 515.65 219.07 Empyrean 5.36 (3.42) Hydra 4.43 126.73 |
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| Particulars | Total Income (Standalone) |
Net Worth (Standalone) |
|||
| Solara | 1,645.29 | 1,592.78 | |||
| Aurore Life Science |
515.65 | 219.07 | |||
| Empyrean | 5.36 | (3.42) | |||
| Hydra | 4.43 | 126.73 | |||
| b) | Whether the transaction would fall within the related transactions? If Yes, whether the same is done at “Arm’s Length” |
The proposed Scheme does not fall within the purview of related party transactions in terms of exemption granted under General Circular No. 30/2014 dated 17thJuly 2014 issued by the Ministry of Corporate Affairs since the Scheme is under Sections 230 to 232 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. 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 Science. |
Solara Active Pharma Sciences Limited - CIN : L24230MH2017PLC291636
REGD. OFF: 201, Devavrata, Sector 17, Vashi Navi Mumbai - 400703. India/ Tel: 91-22-2789 2924 / 2789 3199 / Fax: 91-22-2789 2942
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 : [email protected] www.solara.co.in
| Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax : +91 44 22350278 E-mail : [email protected] www.solara.co.in |
Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax : +91 44 22350278 E-mail : [email protected] www.solara.co.in |
Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax : +91 44 22350278 E-mail : [email protected] www.solara.co.in |
|||
|---|---|---|---|---|---|
| • Empyrean is a wholly owned subsidiary of Aurore Life Science. Pursuant to the scheme, Solara would issue consideration by way of equity shares as recommended by the Board after considering the addendum to the valuation report obtained from Niranjan Kumar, Registered Valuer – Securities or Financial Assets, a Registered Valuer and addendum to the Fairness opinion on the said valuation report is obtained from ICICI Securities Limited. |
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| c) | Area of Business of the entity(ies) |
Company | Business | ||
| Solara | Solara is engaged in the business of manufacturing and development of Active Pharmaceutical Ingredients (‘API’) and also offers Contract Manufacturing and Development Services to the global companies. |
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| Aurore Life Science |
Aurore Life Science is engaged in the business of developing wide range of generic pharmaceutical products. |
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| Empyrean | Empyrean is a wholly owned subsidiary of Aurore Life Science and is engaged in the pharmaceutical business. |
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| Hydra | Hydra is engaged in pharmaceutical business through its subsidiary company Aurore Life Science where in it holds 61.65% stake. |
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| d) | Rationale for the Amalgamation/ Merger |
The Transferor Companies and the Transferee Company are engaged in similar lines of business and complement each other. With an intend to expand the business and achieve larger product portfolio, economies of scale, efficiency, optimisation of logistic and distribution network and other related economies by consolidating the business operations being managed by different management teams, the Board of Directors of the Transferor Companies and Transferee Company proposes to consolidate the business of Transferor Companies with the Transferee Company. The proposed amalgamation of Transferor Companies with Transferee Company would inter alia have the following benefits: 1. The amalgamation will enable the consolidation of the API business of the Transferor Companies with the Transferee Company 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. |
Solara Active Pharma Sciences Limited - CIN : L24230MH2017PLC291636
REGD. OFF: 201, Devavrata, Sector 17, Vashi Navi Mumbai - 400703. India/ Tel: 91-22-2789 2924 / 2789 3199 / Fax: 91-22-2789 2942
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 : [email protected] www.solara.co.in
| Guindy. Chennai - 600 032. India Tel : +91 44 43446700. 22207500 Fax : +91 44 22350278 E-mail : [email protected] www.solara.co.in |
||
|---|---|---|
| 2. The amalgamation would enable to enhance business potential and increased capability to offer a wider portfolio of products with a diversified resource base and deeper client relationships. 3. The amalgamation will significantly de-risk operations with the combined entity having eight manufacturing facilities, three Research & Development Centres and footprint in 75 + countries enabling a wider market reach and customer offerings. 4. Would have improved 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. Would 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. The amalgamation would add new Research and Development capabilities, new products pipeline and capabilities and would also bring in large Contract Research and Manufacturing (‘CRAMS’) business innovator relationship. 7. The proposed consolidation would 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 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 and enhance the shareholder’s value. 9. Moreover, the amalgamation of Transferor Companies with the Transferee Company is expected to increase the long-term value for all the shareholders. Further, the public shareholders of the Transferee Company will have an opportunity to participate in the profit and growth of the businesses of Transferor Companies which are currentlyunlisted. |
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| e) | In case of cash consideration - amount or otherwise share exchange ratio; |
There is no cash consideration involved in the Scheme. To the shareholders of Transferor Company 1: 1298 (One thousand two hundred and Ninety-Eight) fully paid- upequityshares of Rs. 10(Rupees Ten only)each of the |
Solara Active Pharma Sciences Limited - CIN : L24230MH2017PLC291636
REGD. OFF: 201, Devavrata, Sector 17, Vashi Navi Mumbai - 400703. India/ Tel: 91-22-2789 2924 / 2789 3199 / Fax: 91-22-2789 2942
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 : [email protected] www.solara.co.in
| Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 1 held by such shareholders. To the shareholders of Transferor Company 2: Since the entire share capital of Transferor Company 2 shall be held by the Company upon amalgamation of Transferor Company 1 with the Company, no shares shall be issued pursuant to amalgamation of Transferor Company 2 with the Company. To the shareholders of Transferor Company 3: 884 (Eight Hundred and Eighty Four) fully paid-up equity shares of Rs. 10 (Rupees Ten only) each of the Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 3 held by such shareholders. |
Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 1 held by such shareholders. To the shareholders of Transferor Company 2: Since the entire share capital of Transferor Company 2 shall be held by the Company upon amalgamation of Transferor Company 1 with the Company, no shares shall be issued pursuant to amalgamation of Transferor Company 2 with the Company. To the shareholders of Transferor Company 3: 884 (Eight Hundred and Eighty Four) fully paid-up equity shares of Rs. 10 (Rupees Ten only) each of the Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 3 held by such shareholders. |
Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 1 held by such shareholders. To the shareholders of Transferor Company 2: Since the entire share capital of Transferor Company 2 shall be held by the Company upon amalgamation of Transferor Company 1 with the Company, no shares shall be issued pursuant to amalgamation of Transferor Company 2 with the Company. To the shareholders of Transferor Company 3: 884 (Eight Hundred and Eighty Four) fully paid-up equity shares of Rs. 10 (Rupees Ten only) each of the Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 3 held by such shareholders. |
Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 1 held by such shareholders. To the shareholders of Transferor Company 2: Since the entire share capital of Transferor Company 2 shall be held by the Company upon amalgamation of Transferor Company 1 with the Company, no shares shall be issued pursuant to amalgamation of Transferor Company 2 with the Company. To the shareholders of Transferor Company 3: 884 (Eight Hundred and Eighty Four) fully paid-up equity shares of Rs. 10 (Rupees Ten only) each of the Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 3 held by such shareholders. |
Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 1 held by such shareholders. To the shareholders of Transferor Company 2: Since the entire share capital of Transferor Company 2 shall be held by the Company upon amalgamation of Transferor Company 1 with the Company, no shares shall be issued pursuant to amalgamation of Transferor Company 2 with the Company. To the shareholders of Transferor Company 3: 884 (Eight Hundred and Eighty Four) fully paid-up equity shares of Rs. 10 (Rupees Ten only) each of the Transferee Company, credited as fully paid up, for every 10,000 (Ten Thousand) equity shares fully paid up of Rs. 10 (Rupees Ten only) each of the Transferor Company 3 held by such shareholders. |
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|---|---|---|---|---|---|---|---|---|
| f) | Brief details of change in shareholding pattern (if any) of listed entity |
Change in shareholding of Solara: | ||||||
| Category | Pre-Scheme |
Post-Scheme | ||||||
| No. of shares |
% share holding |
No. of shares |
% share holding |
|||||
| Promoter and Promoter Group |
1,42,03,710* | 39.54 | 2,48,05,788 | 50.39 | ||||
| Public | 2,17,26,057 | 60.46 | 2,44,18,779 | 49.61 | ||||
| Non- Promoter Non Public |
- | - | ||||||
| Total | 3,59,29,767 | 100 | 4,92,24,567 | 100 |
Solara Active Pharma Sciences Limited - CIN : L24230MH2017PLC291636 REGD. OFF: 201, Devavrata, Sector 17, Vashi Navi Mumbai - 400703. India/ Tel: 91-22-2789 2924 / 2789 3199 / Fax: 91-22-2789 2942