Fosun Pharma to Reduce 5% Stake in Gland Pharma via $172M Block Deal

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Synopsis:

Fosun Pharma will reduce its stake in Gland Pharma by selling 5% for $172 million. The sale price is set at ₹1,750 per share, at a 4.9% discount. Fosun's stake will decrease from 58% to approximately 53.3%. Further sales are anticipated.

Gland Pharma News Today

Fosun Pharma Industrial Pte, a subsidiary of Shanghai Fosun Pharmaceutical Group, is set to decrease its ownership in India’s Gland Pharma Ltd.

The reduction comes through block deals after failing to sell the stake in a single transaction. Fosun Pharma aims to sell 5% of Gland Pharma, amounting to about $172 million.

Details of the Block Deal

The terms of the deal reveal that Fosun Pharma will offer 8.2 million shares at a floor price of ₹1,750 per share, which represents a 4.9% discount compared to the last closing price of ₹1,839.

UBS is managing the deal, expected to decrease Fosun’s stake from 58% to approximately 53.3%.

Exlpore:Gland Pharma Limited Share Price

Additional Block Deal Ahead

Fosun Pharma plans additional block sales in the coming months to strengthen its balance sheet, unless buyout firms present a compelling offer.

High valuation expectations from Fosun have reportedly hindered potential sales to private equity firms.

Acquisition and Market Performance

Fosun Pharma originally acquired a 74% stake in Gland Pharma in 2017 for about $1.1 billion from a group including KKR & Co.

Over the past year, Gland Pharma’s shares have risen by 82%, despite being over 55% lower than their 2021 peak.

Historical Context and IPO Impact

This block sale marks the second major reduction in Fosun Pharma's stake in Gland Pharma following a successful IPO in November 2020, which raised ₹6,479 crore, including an offer for sale worth ₹5,229 crore by Fosun.

The IPO decreased Fosun’s holding from 75% to 58.36%. As of a recent BSE filing, Fosun Pharma’s stake stood at 57.86%.

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.

This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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