Gland Pharma arm acquires 100% stake of Cenexi Group

The generic injectable focused CDMO company has a strategic focus on expanding its CDMO offerings in the European market and build a manufacturing presence in the market.

Gland Pharma announced that it has through its wholly owned subsidiary Gland Pharma International, Singapore entered into a Put Option Agreement to acquire 100% of Cenexi Group for an equity value not exceeding Euro 120 million (enterprise value of Euro 230 million). The company said that the transaction will be funded by internal resources with no recourse to third-party funding.

The acquisition provides Gland Pharma access to leading know-how and development capabilities in sterile forms including for ophthalmic gel, needleless injectors and hormones. Gland Pharma's ability to support future investments in expanding manufacturing footprint will help build Cenexi as a major CDMO player in the European market. Gland and Cenexi can leverage their long- standing customer relationships to generate synergistic benefit for both entities along with helping Gland enter the branded CDMO space.

Founded in 2004, Cenexi, along with its Subsidiaries, is engaged primarily in the business of Contract Development & Manufacturing Organisation (CDMO) of pharmaceutical products with expertise in sterile liquid and lyophilized fill-finished drug, including capabilities on oncology and complex products. It has presence across four manufacturing sites in Europe which include three sites in France and one site in Belgium. It has experience in processing specific substances like hormones, suspensions and controlled substances. It has an employee strength of 1,372 including 1,252 employees across 4 manufacturing sites and 120 employees for services. Its revenue for CY21 stood at Euro 184.1 Mn.

Srinivas Sadu, MD & CEO, Gland Pharma said This proposed acquisition would be Gland Pharma's first international acquisition, and it would perfectly support our goal of deepening access into the European markets. This acquisition would help expand our global presence and further solidify our identity as an injectable focused CDMO company. Together, we see exciting synergy opportunities from leveraging our combined sterile expertise and development capabilities to expand our customer base and increase share of wallet. The acquisition will not only act as a sustainable lever for long term growth but would also establish a leading European platform to enrich our offering and increase value add to customers."

Hyderabad-based Gland Pharma has grown over the years from a contract manufacturer of small volume liquid parenteral products, to become one of the largest and fastest growing injectable-focused companies, with a global footprint across 60 countries, including the United States, Europe, Canada, Australia, India, and other markets. On consolidated basis, the company's net profit declined 20.1% to Rs 241.24 crore on 3.3% decrease in net sales to Rs 1044.40 crore in Q2 FY23 over Q2 FY22.

The scrip was down 3.25% at Rs 1818.45 on the BSE.

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