Vivimed sells part of specialty chemicals biz to Clariant for Rs 380 crore

Company to use funds to reduce debt

Hyderabad-based Vivimed Labs today said it has signed a definitive agreement for the transfer and sale of a portion of its specialty chemicals product portfolio along with associated trademarks and assets to Clariant Chemicals (India) Limited, a subsidiary of Clariant AG of Switzerland.

The deal value is Rs 380 crore.

The part of the specialty chemicals business being divested to Clariant accounted for about 10% of the consolidated revenue from operations in the last financial year, according to Vivimed.

The consolidated revenues stood at Rs 1,386 crore in the financial year 2014-15.

"This transaction will help us significantly improve financial flexibility for future growth. We are confident that this transaction, once completed, will position Vivimed optimally to the next level of growth across its specialty and pharmaceuticals businesses," Santosh Varalwar, managing director and chief executive officer of Vivimed said.

The major portion of the receipts will be used to reduce debts thereby saving substantial interest costs going forward, the company said.

The potential transaction was taken on board and forwarded for shareholders approval in a meeting of the board of directors on September 12.