Transaction Details

  • Kilitch Drugs to divest entire shareholding in Ethiopian subsidiary Kilitch Estro Biotech PLC (KEB)
  • Buyer: HarmeeCare Pharmaceuticals, an Ethiopian state-owned enterprise
  • Transaction value: US$14 million
  • Board of Directors has approved the proposed transaction
  • Expected completion date: January 31, 2027

Conditions and Approvals

Transaction subject to:

  • Shareholder approval
  • Applicable regulatory requirements
  • Completion of necessary transaction documentation

Strategic Rationale

  • Part of broader strategy to optimize business portfolio
  • Strengthen financial flexibility
  • Accelerate investments in pharmaceutical manufacturing operations in India
  • Enable capital reallocation towards higher-growth opportunities in India
  • Support debt repayment and expansion of core pharmaceutical business

Use of Proceeds

Net proceeds will be utilized for:

  • Reducing existing borrowings
  • Lowering finance costs
  • Supporting phased expansion of new manufacturing facility at Pen, Maharashtra

Manufacturing Expansion Plans

Pen facility expansion includes:

  • Manufacturing of liquid injectable vials
  • Lyophilised (freeze-dried) injectable vials
  • Ophthalmic eye drops
  • Development and manufacturing of GLP-1 (Glucagon-Like Peptide-1) therapies
  • Pursuit of EU GMP (European Union Good Manufacturing Practice) accreditation
  • Pursuit of PIC/S (Pharmaceutical Inspection Co-operation Scheme) accreditation
  • Expansion in regulated export markets

All expansion plans are subject to applicable regulatory approvals.

Commercial Continuity in Ethiopia

  • Company proposes long-term supply and technical services agreement with HarmeeCare Pharmaceuticals
  • Agreement expected to support continued operations of Ethiopian manufacturing facility
  • Provides opportunities for ongoing commercial relationship in the region

Management Commentary

Bhavin Mehta, Whole-Time Director, stated: "Our focus is on building the next phase of Kilitch Drugs' growth by strengthening our manufacturing capabilities and expanding our presence in high-potential pharmaceutical segments. The strategic divestment of our Ethiopian subsidiary will enable us to unlock capital, strengthen our balance sheet and accelerate our expansion plans in India. With our new Pen facility coming on stream in phases, we see significant opportunities to leverage our manufacturing experience, participate in emerging therapy segments such as GLP-1 and deepen our presence in international regulated markets."

Company Background

Kilitch Drugs (India) Limited is a Mumbai-based pharmaceutical company with over three decades of experience in pharmaceutical manufacturing, including aseptic formulations. The company manufactures and markets pharmaceutical products for domestic and international markets.