Cipla to divest 51.18% stake in Uganda-based subsidiary

Cipla and its wholly owned subsidiaries, Cipla (EU), UK, and Meditab Holdings, Mauritius, have entered into a share purchase agreement with Africa Capitalworks SSA 3 for sale of 51.18% stake held in Cipla Quality Chemical Industries (CQCIL), Uganda.

"Subsequent to the sale, CQCIL will cease to be a subsidiary of the Company, Cipla said in a statement.

As of 31 March 2022, CQCIL's net worth was $44.08 million (1.62% of Cipla's consolidated networth) and its total revenue was $75.21 million (2.57% of Cipla Limited's consolidated revenue).

The buyer, Africa Capitalworks SSA 3, is a wholly owned subsidiary of Africa Capitalworks Holdings (ACW), an investment management company incorporated in Mauritius. ACW is engaged in providing permanent equity capital and complementary skills to mid‐market companies across Sub‐Saharan Africa. The agreement for the said stake sale was signed on 14 March 2023. The company expects to complete the proposed sale by 31 May 2023, subject to obtaining regulatory approvals and completion of conditions precedent as mutually agreed between the parties.

The consideration to be received by Cipla (EU) and Meditab Holdings shall be in the range of $25-30 million.

Cipla is a global pharmaceutical company focused on agile and sustainable growth, complex generics, and deepening portfolio in our home markets of India, South Africa, North America, and key regulated and emerging markets.

The pharma major's consolidated net profit rose 9.93% to Rs 800.96 crore on 6.05% increase in total revenue from operations to Rs 5,810.09 crore in Q3 FY23 over Q3 FY22.

The scrip advanced 0.49% to currently trade at Rs 876.50 on the BSE.

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