RPG Life Sciences Ltd (RPG LS) has executed a Business Transfer Agreement to transfer its Active Pharmaceutical Ingredients (API) business to its wholly owned subsidiary, RPG Active Pharma Ltd, on a slump sale basis as a going concern.
The restructuring is part of the company’s strategy to create a focused API business with dedicated capital, sharper management focus and greater strategic flexibility, while continuing to strengthen its formulations business.
Strategic investment
RPG Life Sciences has also entered into an investment agreement with healthcare-focused private equity investor InvAscent to support the growth of RPG Active Pharma.
Funds managed by InvAscent will make an initial investment of up to ₹243 crore in the subsidiary. The agreement also provides for cumulative investments by RPG Life Sciences and InvAscent of up to ₹700 crore in phases.
Strengthening infrastructure
The capital will be used to strengthen manufacturing infrastructure, expand the API portfolio, enhance process development capabilities and pursue both organic and inorganic growth opportunities.
“Building a meaningful and scalable presence in APIs has been a strategic priority for RPG Life Sciences. RPG Active Pharma gives us a focused business to pursue this opportunity with greater speed, discipline and scale,” said RPG Life Sciences Managing Director Ashok Nair.
Long term partnership
InvAscent’s pharma investing experience and long-term partnership approach complements the company’s vision for the business.
The proposed acquisition of Actis Generics further strengthens this business and supports our ambition to build a high-quality API business with expanded manufacturing capabilities, a broader product portfolio and the ability to create sustainable value for all stakeholders,” he said.
Actis Generics acquisition
Separately, RPG Active Pharma has signed a Share Purchase Agreement to acquire 100% equity in Visakhapatnam-based API manufacturer Actis Generics Pvt Ltd.
The acquisition is expected to expand the subsidiary’s manufacturing footprint, broaden its operating platform and support its long-term growth strategy.
Preparing for next phase
The company said the investment by InvAscent and the acquisition of Actis Generics are aimed at establishing RPG Active Pharma as a focused API manufacturer for the next phase of growth.
Going forward, the subsidiary will focus on expanding manufacturing capabilities, widening its API portfolio and strengthening its presence in domestic and international markets with an emphasis on quality, reliability and long-term customer partnerships.
Leadership comment
“RPG Life Sciences has a clear ambition to scale its API business. RPG Active Pharma is well positioned to benefit from the long-term growth opportunity in high-quality API manufacturing. We look forward to supporting the business through capital, strategic guidance and our healthcare sector experience,” said InvAscent Managing Director Jeevak Gupta.