Solara & Aurore combine to create the second-largest Pure Play API company in India

Solara Active Pharma Sciences Limited on Sunday, April 11, 2021, announced that its board of directors has accepted the recommendations of the Committee of Independent Directors and Audit Committee and approved the amalgamation of Aurore, Empyrean and Hydra with Solara.

The combination creates a pure-play API company of scale with a strong presence in Regulated Markets, Emerging Markets, a broad product portfolio, robust operations infrastructure, excellent R&D capabilities and clear synergies to further accelerate growth for the combined entity.

The company today in a regulatory filing to BSE said, "The Board of Directors of Solara Active Pharma Sciences on 09 April 2021 has approved a composite scheme of amalgamation of Aurore Life Science, Empyrean Lifesciences and Hydra Active Pharma Sciences with Solara."

The merger is EPS accretive to Solara and will enhance other important financial ratios for Solara. The merger is in line with Solara's strategy of accelerating growth via appropriate inorganic actions. The combined entity will have the scale of market presence and product portfolio combined with robust manufacturing and R&D infrastructure to grow into a leading global pure-play API and CRAMS company.

Strategic Rationale of the Merger:

1) The combination significantly enhances the product portfolio of the combined entity.

2) The addition of 2 sites (one of them USFDA approved) will enable the creation of additional sourcing locations for key products for our customers, further underlining the reliability of supply.

3) The merged entity will leverage the strong R&D investments bringing more products to market with improved time to market.

4) The merger will add scale and capabilities to the existing CRAMS business of Solara and will aid in the accelerated growth of this business.

5) The merger will lead to significant synergistic opportunities in operations and cost savings through economies of scale.

6) The merger creates a leading pure-play API player with a global market presence, diverse product portfolio and strong customer relationships.

Shareholders of Aurore Life Sciences Private Limited and Hydra Active Pharma Sciences Private Limited shall be issued 1,32,94,800 equity shares of Solara Active Pharma Sciences Limited. Pursuant to which, the shareholders of the Transferor Companies would have a 27 per cent stake in Solara Active Pharma Sciences Limited.

With this merger, Aurore Life Science Private Limited, Empyrean Lifesciences Private Limited and Hydra Active Pharma Sciences Private Limited shall be merged into Solara Active Pharma Sciences Limited and post-merger, Solara will hold 67 per cent stake in Aurore Pharmaceuticals Private Limited.

Post-Merger, Promoter group holding shall be 55.15 per cent and public holding shall be 44.85 per cent. The Appointed Date for the merger would be April 1, 2021, and the merger process is expected to be completed in Q4 FY 2021-22.

The merger is subject to certain conditions including approvals from stock exchanges, SEBI, shareholders, creditors, jurisdictional National Company Law Tribunal and other applicable statutory authorities.