Jubilant Pharma to Divest Stake in Sofie Biosciences for $139.4 Mn

The proceeds from the divestment will be utilised for fund capital expenditures, and support other corporate purposes.

Jubilant Pharma Limited, a Singapore-based subsidiary of Mumbai-listed Jubilant Pharmova, is set to sell its entire 25.8% stake in Sofie Biosciences, a US-based molecular diagnostics and therapeutics company, for $139.4 million.

The stake was acquired by Singapore-based Jubilant Pharma through a $25 million (approx INR 185 Cr) investment in Sofie Biosciences in November 2020. These rough calculations suggest that the company is achieving returns on its investment that are 5.5 times in dollar terms and over six times in rupee terms.

Sofie Biosciences specialises in radiopharmaceutical production, distribution, and contract manufacturing services, holding valuable theranostic intellectual property.

Merger Agreement with Trilantic North America

Sofie Biosciences has entered into a definitive merger agreement with private equity funds managed by Trilantic Capital Partners, North America. The merger transaction is anticipated to be completed by June 30, 2024, subject to customary conditions and regulatory approvals.

Under the agreement, Jubilant Pharma Limited (JPL) plans to divest its entire equity stake in Sofie Biosciences for aggregate proceeds of approximately $139.43 million.

Jubilant Pharmova, formerly known as Jubilant Life Sciences Ltd, has outlined a two-stage receipt of transaction proceeds. In the initial stage, the company will receive $113.63 million, subject to customary adjustments upon the merger's completion. The remaining amount of $25.8 million is contingent upon the achievement of specific future milestones.

The proceeds from the divestment will be utilised by Jubilant Pharma for fund capital expenditures, and support other corporate purposes.

Jubilant Targets Molecular Diagnostics & Therapeutics Sector

Jubilant Radiopharma, a division of Jubilant Pharma Ltd’s (JPL) business also includes distribution through radiopharmacies, contributing to Jubilant Pharmova's global pharmaceutical operations.

JPL operates in various segments, including the supply of radiopharmaceuticals, contract manufacturing of sterile injectables and non-sterile products, and the production of solid dosage formulations.

The company's manufacturing facilities serve regulated markets, including the USA, Europe, and other geographies.

The divestment of the stake in Sofie Biosciences aligns with Jubilant Pharmova's strategic objectives and allows the company to unlock value from its investment. The merger with Trilantic North America is anticipated to strengthen Sofie Biosciences' position in the molecular diagnostics and therapeutics sector.

The financial infusion from this transaction will empower Jubilant Pharmova to enhance its financial flexibility, pursue capital investments, and support corporate initiatives. As the pharmaceutical and radiopharmaceutical industries continue to evolve, such strategic moves contribute to positioning companies for sustained growth and innovation in the dynamic healthcare landscape.

In another divestment development, in November last year, Aster DM Healthcare Ltd unveiled its plan to separate its Gulf business and sell it to a consortium led by the Moopen family, the company's Indian promoters, and a Dubai consortium for a total of $1.001 billion. The move aims to unlock shareholder value and broaden the appeal to a wider range of institutional investors.

Under this plan, a consortium backed by the UAE government's Fajr Capital is set to acquire a 65% stake in the Gulf entity. Simultaneously, Azad Moopen, the promoter of Aster, will retain ownership of the remaining 35% once the transaction is finalised. The Gulf business, which contributes 70% of Aster's revenues, will be housed under Alpha GCC Holdings Ltd, a wholly-owned subsidiary of Aster DM Healthcare.