Pharmaceutical major Aurobindo Pharma Limited on Monday stated that it has signed an agreement to divest Natrol, a wholly-owned unit of its United state-based subsidiary, to private equity firm New Mountain Capital for Rs 4,048 crore, or USD 550 million approx.

It was in December 2014 that Aurobindo Pharma acquired Natrol. As per statement by the Aurobindo Pharma, it reads that the Company has reached a definitive agreement to sell Natrol, a unit of Aurobindo Pharma USA, Inc, to an affiliate of New Mountain Capital to combine with Jarrow Formulas. The all-cash transaction is valued at USD 550 Million or Rs 4,048 crore at the current exchange rate, it added. Subject to customary closing conditions and regulatory approvals, the transaction is expected to close by January 2021, the company said.

Natrol's yearly sales for the one year ended March 31, 2020, stood at around USD 157 million. It has been a consistently profitable business, growing on all fronts under Aurobindo's ownership, it added. Aurobindo pharma is committed to evaluating and concluding strategic options towards focused portfolio development with the prime objective of enhancing stakeholder values. Aurobindo Pharma MD N Govindarajan’s quote reads - We are pleased to sell the Natrol business to an outstanding private equity player, who could focus additional resources to grow Natrol, its products and brands further. The proceeds from Natrol''s divestiture will be used to reduce debt and other new strategic initiatives.

Reacting to the development, shares of Aurbindo Pharma quoted higher at Rs. 796.20, up by 1.71 percent from its previous closing on the NSE, during mid morning session, Monday .   

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