Strides Arcolabs stock tanks on completion of Agila sale to Mylan

Stock of Strides Arcolab fell more than 12 per cent on Thursday after the firm informed BSE that it has completed the sale of its Agila Specialties division to Nasdaq-listed  Mylan Inc for a total consideration of up to $1.75 billion.

At 12:37 pm, the stock of the  company fell 12.46 per cent or 122 points to  Rs 864 levels on the BSE.

Strides Arcolab has agreed to a holdback of $250 mn contingent upon satisfaction of certain regulatory conditions.

Since the annoucment of this transaction, the company also expects the additional expenditure of $150 mn, it said in a release to the BSE.

In September, the USFDA had issued a warning letter to Agila Specialties over violation of manufacturing norms in one of its plants in Bangalore following an inspection in June.

Earlier in the same month, the government had approved Mylan's deal to fully acquire Agila Specialties from Strides Arcolab. The companies had announced the deal in February.

While announcing the deal, the US-based firm had said that Agila will bring a broad product portfolio of more than 300 filings approved globally and marketed through a network covering 70 countries, including 61 abbreviated new drug applications (ANDAs) approved by the US Food and Drug Administration (USFDA).

Commenting on the completion of the transaction, Strides Acrolab Founder & Group CEO Arun Kumar said: "We are delighted with the conclusion of this transaction and are confident that Agila will play a significant role in Mylan's growth strategy to become a global injectable leader."

Post the deal, over 1,800 employees of Strides Group would become part of Mylan. Agila currently produces drugs across nine manufacturing facilities in India, Brazil and Poland, eight of which have been approved by the USFDA.

-With PTI inputs