Pharmaceutical company Lupin has agreed to divest its stake in Kyowa Pharmaceutical Industry to private equity firm Unison Capital Partners’ entity Plutus for JPY57.4bn ($526m).
The transaction will be carried out by Lupin subsidiary Nanomi, which holds 99.82% in Kyowa Pharmaceutical.
Founded in 1954, Kyowa Pharmaceutical is engaged in the development, manufacturing and sale of branded and generic pharmaceutical products in Japan.
Its portfolio includes products across various therapeutic areas, including cardiovascular and gastroenterology fields. The company sells central nervous system / neurology products under the Amel brand.
Lupin acquired majority ownership in the company in 2007. Currently, Kyowa Pharmaceutical has manufacturing facilities in Sanda and Tottori, along with a research centre in Osaka.
Kyowa Pharmaceutical generated revenues of JPY14.241bn ($131m) in the first half of the fiscal year 2020 and JPY28.335bn ($260m) in the fiscal year 2019.
Lupin estimates the divestiture to generate net cash inflow of approximately JPY32.596bn ($299m). The proceeds from the deal will be used to boost the company’s balance sheet and as growth capital for organic and inorganic initiatives.
Lupin CEO Vinita Gupta said: “We acquired Kyowa in 2007 and since then have made a material difference to the Japanese healthcare system with the affordable medicines we brought to market.
“This transaction is aligned with our vision to focus on our key markets and strategic priorities to achieve sustainable growth in the mid to long-term.”
Unison’s investments in healthcare will help boost Kyowa’s footprint in the CNS field.
In a statement, Unison said: “Unison aims to support Kyowa’s management team as the company continues to strengthen its existing business, based on pursuing a hybrid (generic / brand) strategy.
“The company will also work on realising its unique growth strategy of expanding its product and service portfolio beyond drugs, which Unison will support through its healthcare ecosystem of researchers, advisors and strategic partners, including Unison’s own healthcare portfolio companies.”
Lupin’s board of directors approved the transaction, which is expected to close in March next year.