Novartis agrees to sell 70.68% stake in its Indian subsidiary to investment consortium for 14.46 billion rupees

Novartis (NVS) has agreed to sell its 70.68% stake in Novartis India Limited for 14.46 billion rupees (approximately $159 million) to an investor consortium composed of WaveRise Investments, ChrysCapital Fund X, and Two Infinity Partners, thereby effectively concluding the strategic review it announced in February 2024. The review focused on the publicly listed Indian subsidiary, which is responsible for selling prescription drugs, generic drugs, and over-the-counter products. The newly signed agreement now provides a clear direction for the business under new majority ownership.

As part of the deal structure, the acquiring consortium has also launched a public offer to purchase up to 26% of Novartis India at a price of 860.84 rupees per share, valuing the offer at approximately 5.52 billion rupees. The market reacted quickly: in Mumbai trading, shares of Novartis India surged as much as 19.3% to 996.50 rupees, trading above the public offer price. This movement may indicate that investors see potential upside for the company beyond the terms of the offer, in its forthcoming new chapter.

Importantly, Novartis had previously clarified that the strategic review did not include its wholly owned subsidiary Novartis Healthcare Private Limited, which houses the Hyderabad corporate center, manages commercial operations, and oversees R&D teams conducting clinical trials at more than 300 locations nationwide. Even before the review began, Novartis India had signed distribution agreements with domestic partners, including deals with Dr. Reddy’s Laboratories Ltd. to market brands such as Voveran, calcium range products, and Methergine in India. Overall, this divestment appears to reshape the ownership structure of the listed subsidiary while retaining Novartis’ broader infrastructure and R&D footprint in India.

Editor: Zhang Jun SF065