Zydus Lifesciences has further extended the closing date for its proposed acquisition of the Active Pharmaceutical Ingredient (API) business from Sterling Biotech Limited to September 30, 2026. The extension is necessary as the target entity is still in the process of completing certain conditions precedent outlined in the Business Transfer Agreement (BTA).

Timeline Adjustments

The transaction, initially expected to conclude by December 31, 2024, has faced multiple delays. In a previous intimation dated December 24, 2025, Zydus Lifesciences and Sterling Biotech Limited mutually agreed to push the deadline to June 30, 2026. With the conditions precedent still pending, the parties have now executed a letter to extend the closing date to September 30, 2026.

Transaction Details

The acquisition focuses on the API business of Sterling Biotech Limited, a key segment in pharmaceutical manufacturing supply chains. The deal remains subject to the fulfilment of specific regulatory and procedural conditions before it can be formally concluded.

Zydus Lifesciences has entered into a joint venture with Sunshine Healthcare Lanka Limited to establish a pharmaceutical manufacturing facility in Sri Lanka, aiming to strengthen local production and reduce import dependence. The joint venture entity, Zydus Sunshine Lifesciences (Private) Limited, will see both partners hold equal stakes, with Zydus subscribing to 50% of the total paid-up equity share capital. The project involves an investment commitment of over USD 20 million to develop a state-of-the-art facility in the Board of Investment zone in Horana.

The Share Subscription and Shareholders’ Agreement was signed on June 26, 2026. Zydus Lifesciences will subscribe to the shares through a cash consideration of up to USD 5 million in one or more tranches, subject to specific adjustments. The subscription is expected to be completed within 90 working days from the date of execution of the agreement. The target entity, incorporated on May 30, 2026, currently has nil turnover as it is a recently established company.

Joint Venture Structure and Governance

The Board of Zydus Sunshine Lifesciences will comprise six directors, with three representatives each from Zydus Lifesciences and Sunshine Healthcare Lanka. Zydus will appoint the Chairperson, who will hold a casting vote on all matters except reserved matters. Any changes to the capital structure will require the approval of both partners. The transaction does not fall within related party transactions, and none of the promoter or group companies have any interest in the subscription.

The facility will be developed on nearly four acres of land in the Horana Export Processing Zone. It will focus on manufacturing pharmaceutical products for Sri Lanka's retail market. The project is designed to support national supply chain resilience and enhance the availability of essential medicines under the oversight of the Board of Investment of Sri Lanka, with the Ministry of Health and the National Medicines Regulatory Authority as key stakeholders.