Cohance Lifesciences and Suven Pharma Join Forces in Landmark Merger; Stock Surge 12%

1 Mar 2024 , 11:26 AM

A proposed plan of amalgamation for the combination of Suven Pharmaceuticals Limited and Cohance Lifesciences Limited was announced on February 29.

According to a press release from Suven Pharmaceuticals, the entire deal is anticipated to be completed within the next 12 to 15 months, pending the receipt of all necessary shareholder and regulatory approvals. 

Leading global private equity fund Advent International selected Kotak Mahindra Capital and Citi as advisors for deal aspects like swap ratio, due diligence, and fairness opinion. The merger process for its portfolio companies Suven Pharmaceuticals and Cohance Lifesciences was started on February 7, 2024, and Moneycontrol was the first to report it.

Beyond its present revenue base, the combination will position Suven as a diversified API (Active Pharmaceutical Ingredient) and CDMO (Contract Development and Manufacturing Organization) leader in India, the business also disclosed to exchanges. 

It is anticipated that the combined company will rank among India’s top integrated CDMO providers. Scale and synergy benefits would be tremendous with a substantially broader client base and an enhanced capacity of 2,650 kL.

All Cohance shareholders will get shares of Suven upon the scheme’s implementation, based on the swap ratio, at a ratio of 11 shares of Suven for every 295 Cohance shares. The NSE and BSE will be the trading platforms for the newly issued shares of Suven. Advent entities will possess 66.7 percent of the combined business, while public shareholders will hold 33.3% (prior to ESOP dilution).

Suven Pharma’s stock surged by 12% during morning trading on March 1, following the company’s announcement of a merger scheme with Cohance Lifesciences. By 11.24 am, Suven Pharma shares were up approximately 7.75%, trading at ₹677.75 on the National Stock Exchange.

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