Suven Life Sciences reported on Saturday getting the US Bankruptcy Court approval of stalking horse agreement to buy assets of Aceto Corporation's Rising Pharmaceuticals through its joint venture partner Shore Suven Pharma Inc.
A stalking horse agreement refers to an initial bid for a bankrupt company's assets and sets the lower limit in a bankruptcy auction. The sale was conducted through a court-supervised process under Section 363 of the Bankruptcy Code.
Suven Life Sciences, the Rs 625 crore pharmaceutical company, provides contract research and manufacturing services to global life sciences companies. It will reportedly invest 75 million dollars (about Rs 520 crore) in the new business.
Under the process, Shore Suven Pharma's purchase agreement served as the stalking horse agreement and an auction would have been conducted had the company received qualified offers from other bidders reflecting potentially higher or better terms.
No such bids were received prior to the bid deadline. Thus no auction was conducted and Shore Suven Pharma was selected as the successful bidder for Rising Pharmaceuticals on March 29, the company said in a statement.
The transaction is expected to close on April 19.
"It paves the way for a seamless transition of the portfolio, customer programmes and manufacturing and drug development relationships to Shore Suven Pharma Inc, which in turn will pave the way for continuity of product supply to the customers," he said.
"Leveraging Rising's extensive product portfolio and vertically integrating with Suven's world-class active pharmaceutical ingredient (API) and finished dose manufacturing capabilities will enable us to better serve US customers," he said.
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