Natco Pharma Limited, a leading Indian pharmaceutical company, has unveiled plans for a significant strategic investment in South Africa's pharmaceutical sector. The company has scheduled an investor call on July 23, 2025, at 5:00 PM IST to discuss the details of this proposed investment with investors and analysts.

Proposed Acquisition

Natco Pharma has submitted a firm intention offer to acquire a substantial stake in Adcock Ingram Holdings Limited (Adcock Ingram), a prominent South African pharmaceutical company. The proposed deal involves:

• Acquisition of 51,643,319 shares of Adcock Ingram
• Cash offer of ZAR 75.00 (approximately US$ 4.27) per share
• Total investment of approximately ₹2,000 crore (Rupees Two Thousand Crores), including transaction costs and other expenses

If the offer is accepted, Natco Pharma will hold a 35.75% stake in Adcock Ingram, valued at ZAR 4 billion (US$226 million).

Strategic Rationale

The acquisition aligns with Natco Pharma's global expansion strategy, particularly in emerging markets. Key points include:

• Entry into the South African market, one of the largest emerging pharmaceutical markets
• Access to Adcock Ingram's diverse portfolio of well-recognized brands
• Potential for multiple value creation opportunities through synergies
• Gateway to the African continent for future expansion

About Adcock Ingram

Adcock Ingram, founded in 1890, is the second-largest pharmaceutical company in South Africa. It operates across four segments: Prescription, Consumer, OTC, and Hospitals. The company's financial highlights include:

Transaction Details

• Natco Pharma plans to incorporate a wholly-owned subsidiary in South Africa named NATCO Pharma South Africa Proprietary Limited
• The transaction is subject to regulatory approvals, including those from the Reserve Bank of India and South Africa's Takeover Regulation Panel
• Estimated completion time is by December 31, 2025, barring regulatory delays

Management Comments

Rajeev Nannapaneni, CEO & Vice Chairman of Natco Pharma Limited, stated, "The proposed transaction will provide Natco Pharma with a well-established entry into the Southern African market. It will also allow Natco Pharma to tap into new revenue streams and expand our footprint in one of the largest and growing emerging markets, while providing a gateway to the African continent."

Investor Call

Natco Pharma will host an investor call on July 23, 2025, at 5:00 PM IST to discuss the proposed investment. Investors and analysts can join the call through a designated link provided by the company.

This strategic move by Natco Pharma represents a significant step in its global expansion strategy, potentially reshaping its presence in the African pharmaceutical market.

Natco Pharma Limited, a prominent Indian pharmaceutical company, has announced a significant move to expand its global footprint by acquiring a substantial stake in one of South Africa's leading pharmaceutical firms. The company's board of directors has approved the acquisition of a 35.75% stake in Adcock Ingram Holdings Limited for approximately ₹2,000 crore.

Transaction Details

The acquisition involves purchasing 51,643,319 shares of Adcock Ingram at ZAR 75.00 (approximately US$4.27) per share. This includes:

• 50,351,444 ordinary shares from the public
• 1,291,875 treasury shares or fresh issuance from Adcock Ingram

The total investment, including transaction costs and other expenses, is estimated at ₹2,000 crore.

Strategic Expansion

As part of this strategic move, Natco Pharma also plans to:

1. Incorporate a wholly-owned subsidiary in South Africa, tentatively named NATCO Pharma South Africa Proprietary Limited, with an investment of up to ₹2,100 crore.
2. Liquidate its wholly-owned subsidiary, Time Cap Overseas Limited (TCOL), and directly hold the investment in NatcoFarma do Brasil Ltda., which is currently a step-down wholly-owned subsidiary.

About Adcock Ingram

Adcock Ingram, founded in 1890, is a well-established pharmaceutical company in South Africa. It operates across four segments:

• Prescription
• Consumer
• Over-the-Counter (OTC)
• Hospitals

The company boasts a diverse portfolio of products, including generic and branded formulations, critical-care hospital products, and consumer and home-care items.

Financial Performance

Adcock Ingram has demonstrated strong financial performance in recent years:

Post-Acquisition Structure

Following the acquisition, Adcock Ingram will operate as a private South African business, with two major strategic shareholders:

• The Bidvest Group Limited: 64.25%
• Natco Pharma Limited: 35.75%

Synergies and Growth Opportunities

The acquisition is expected to create multiple value creation opportunities:

1. Marketing and distribution of Natco's products in South Africa through Adcock Ingram's established network.
2. Introduction of affordable and innovative pharmaceutical products in African markets.
3. Potential cost efficiencies through Natco's manufacturing and sourcing capabilities.
4. Leveraging Natco's R&D team for cross-pollination of ideas across Africa.

Regulatory Approvals and Timeline

The proposed transaction is subject to several regulatory approvals, including:

• Reserve Bank of India (under the Foreign Exchange Management Act)
• South Africa's Takeover Regulation Panel (TRP)
• South African Reserve Bank (SARB)

Natco Pharma expects to complete the transaction by December 31, 2025, subject to these regulatory approvals.

Management Statements

Rajeev Nannapaneni, CEO & Vice Chairman of Natco Pharma Limited, stated, "The proposed transaction will provide Natco Pharma with a well-established entry into the Southern African market. It will also allow Natco Pharma to tap into new revenue streams and expand our footprint in one of the largest and growing emerging markets, while providing a gateway to the African continent."

Andrew Hall, CEO of Adcock Ingram Holdings Limited, commented, "This offer represents a huge vote of confidence in Adcock Ingram's people, brands and business model, and the South African healthcare environment. Adcock Ingram will benefit from a partnership with a research-focused, innovative and vertically-integrated pharmaceutical company."

This strategic acquisition marks a significant milestone for Natco Pharma, positioning it for growth in the African pharmaceutical market and enhancing its global presence in the healthcare industry.