Strides’ OneSource Secures ₹8,010 Million in Pre-Listing Fundraising

On October 16, 2024, Strides Pharma Science Limited (Strides) announced that its associate company, OneSource Specialty Pharma Limited (formerly Stelis Biopharma), has secured commitments to raise ₹8,010 million (~USD 95 million) from prominent domestic and international investors, as well as family offices, ahead of its listing.

The fundraising deal is based on a pre-money equity valuation of USD 1.65 billion, translating to an embedded value of ₹663 per share for Strides’ shareholders. This is an 82% premium over the previous value of ₹364 per share, as mentioned in the Scheme of Arrangement announced in September 2023. The high level of investor interest highlights the growing confidence in the company’s potential and the promising future of India’s Contract Development and Manufacturing Organization (CDMO) sector.

This capital raise aligns with the Scheme of Arrangement laid out in September 2023, and the investment is subject to customary conditions, including regulatory approvals. Legal firm DSK Legal served as legal counsel, and Transaction Square acted as the advisor for the arrangement.

To give some background: On September 25, 2023, Strides announced the creation of OneSource, India’s first dedicated CDMO for speciality pharma, by merging the biologics CDMO of Stelis, SteriScience’s complex injectables, and Strides’ soft gelatin businesses into one entity. As part of this scheme, Strides shareholders will receive one share of OneSource for every two shares of Strides (with a 1:2 swap ratio). OneSource is currently seeking final approval from the National Company Law Tribunal (NCLT) in Mumbai and aims to list its shares by March 2025, pending regulatory approvals.

Badree Komandur, MD and Group CEO of Strides said, “We are pleased to have successfully received equity commitments for OneSource, ensuring its future growth. The transaction will unlock ~₹61,000 million (~USD 725 million ) of value for Strides’shareholders. The significant premium that will be achieved from this transaction for Strides’ shareholders is a testament to our continued value creation for our stakeholders.” Business updates of OneSource and Strides will be part of our Q2FY25 earnings reporting scheduled for the latter part of October’24.

About Strides Pharma Science

Strides Pharma Science Ltd is a global pharmaceutical company based in Bengaluru, India. The company primarily focuses on regulated markets and follows an “in Africa for Africa” approach, while also serving donor-funded markets through its institutional business.

On October 16, Strides Pharma Science Ltd’s share price opened at ₹opened at ₹1,575.00, touching the day’s high at ₹1,600.00 as of 09:35 AM on NSE.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.