Board of Caplin Point Laboratories approves investment of up to USD 7 mn in step down subsidiary in El Salvador

At meeting held on 06 August 2018

The Board of Directors of Caplin Point Laboratories at its meeting held on 06 August 2018 has approved an investment in a step down subsidiary at El Salvador up to a limit of USD 7 million in ordinary shares and/or debt by its wholly owned subsidiary i.e. Caplin Point Far East.

The company is currently selling its Generic and Branded Generic products through channel partners in most countries in Latin America. The company's current strategy is to establish better control over the Supply Chain and increase the share of Branded Generics in the revenue stream and reach the end consumer directly. The company plans to acquire the businesses from the channel partner(s) in this region progressively, create and invest in distribution subsidiaries based out of Latin America and bring them into the fold of Caplin Point Laboratories.

As a first step towards this endeavour, in order to acquire the business which inter-alia includes inventory of the channel partner at El Salvador, it has now been decided to invest in Ordinary Capital and/ or Debt of FAEMA AMEmCA S.A de CV, a Company incorporated in El Salvador, through Wholly Owned Subsidiary Caplin Point Far East Limited, Hong Kong, such that the entire shareholding is held by Caplin Point Far East Limited. The name of the company will be changed to Caplin El Salvador S.A.de C.V upon making the investment, subject to regulatory approvals at El Salvador.

The process is likely to be completed within three months, during which time it has also been agreed to avail the transition services from the channel partner so that the business is not hampered during the switch-over.

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