Piramal sells DRG business to Clarivate for over `6,745 crore
New Delhi: Ajay Piramal-led Piramal Enterprises on Friday said it has signed an agreement for the sale of its Decision Resources Group (DRG) business to US-headquartered Clarivate Analytics for $950 million (over Rs 6,745 crore).
The transaction is expected to be completed by end of February 2020, Piramal Enterprises (PEL) said in a statement.
PEL DRG Dutch HoldCo BV, a 100 per cent subsidiary of the company and the holding company for DRG, has signed a definitive agreement for the sale of DRG to Clarivate Analytics for a consideration of $950 million, it added.
This includes $900 million on closing and $50 million to be received at the end of 12 months from the date of closing, Piramal Enterprises said.
PEL had initially invested $650 million in 2012 to acquire DRG, out of which $260 million was infused as equity. It has realised 2.3 times its initial equity investment in rupee terms, it added.
Piramal Group Chairman Ajay Piramal said: "We are pleased to have grown DRG's market leadership over the last few years and believe that through this combination, Clarivate, with its size and scale, is well positioned to further accelerate DRG's growth potential."
Along with the ongoing equity capital raising exercise in PEL, this transaction not only further strengthens the company's balance sheet but also marks another step towards significantly unlocking value in future, he added.
"This transaction demonstrates our continued commitment to create sustained long-term value for all stakeholders," Piramal said.
DRG, the data, analytics and insights business of the Piramal Group, specialises in enabling the pharma, biotech and medical technology companies to achieve commercial success in complex health markets with the creation of effective patient-centric commercial strategies.
"This is a milestone acquisition which doubles the size of our life sciences business, is accretive to our 2020 earnings and sets us up as an essential, end-to-end, industry-leading data and analytics provider in the highly attractive Life Sciences ecosystem," Clarivate Analytics Executive Chairman and CEO Jerre Stead said.
With this acquisition, Clarivate will be well positioned in the $19 billion Life Sciences analytics market, which is enjoying double-digit growth, to support customers across the entire drug, device and medical technology lifecycle from research to outcome, the statement said.
Shares of Piramal Enterprises were trading at Rs 1,633.45 per scrip on BSE, up 5.59 per cent from their previous close.