Suven Pharma surges 13% on merger announcement with Cohance Lifesciences

Suven Pharma share surge: The shares of Suven Pharmaceuticals Limited witnessed a remarkable surge of 13 per cent to an intraday high of Rs 711.85 on the National Stock Exchange (NSE). This surge follows the announcement of a proposed merger between Suven and Cohance Lifesciences Limited, a move set to reshape the landscape of the pharmaceutical and specialty chemical industry in India.

The proposed scheme of amalgamation between Suven and Cohance marks a transformative step for Suven, highlighting its commitment to scaling operations, ensuring consistent earnings, fortifying financial standing, and advancing towards leadership in the integrated Contract Development and Manufacturing Organisation (CDMO) space, Suven Pharma said in an exchange filing.

Cohance Lifesciences, recognised as a leading CDMO and Merchant API platform, brings to the table global leadership in select low-mid volume molecules and unique capabilities in the antibody-drug conjugates (ADC) platform. The merger is expected to establish Suven as a diversified CDMO and API leader in India, transcending its current revenue base.

The merger enhances Suven's position in the high-growth CDMO segment, providing multiple engines of growth through three distinct business units: Pharma CDMO, Spec Chem CDMO, and API+. The addition of Cohance's fast-growing ADC platform reinforces Suven's position as a leading CDMO platform, offering comprehensive molecule development and lifecycle management solutions.

The proposed merger, subject to regulatory and shareholder approvals, is anticipated to conclude over the next 12-15 months. Upon completion, all shareholders of Cohance will be issued shares of Suven at a ratio of 11 shares of Suven for every 295 shares of Cohance.

Annaswamy Vaidheesh, Executive Chairman of Suven, called it a “transformative step in Suven’s journey of growth and building a respected integrated CDMO player.” "We are extremely excited about the benefits of combined scale, capabilities, complementary customer base and best practices that will further help enhance our leadership position in India and globally,” he added.

"Our entire management team, spanning Suven and Cohance, is enthusiastic about shaping the future of the Pharmaceutical & Specialty Chemical landscape. The combination helps us drive multiple synergies
both on revenue and cost front," said V Prasada Raju, Managing Director, Suven Pharmaceuticals.

Suven Pharma shares were trading 8.01 per cent higher at Rs 679.80 apiece on the NSE as of 11:35 am, March 1, 2024.