NCLT approves demerger, simplification of corporate structure

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NCLT approves demerger, simplification of corporate structure

The National Company Law Tribunal NCLT approved the demonetization of Piramal Enterprises' pharma business and the simplification of its corporate structure on Friday. The demonetization of the enterprises pharma business and the simplification of the corporate structure were approved by the Piramal Group s Board in October 2021.

The NCLT order has now lead to the creation of two separate listed entities - Piramal Enterprises Limited NBFC and Piramal Pharma Limited, the group revealed in its regulatory filing to the stock exchanges.

Ajay Piramal, Chairperson of Piramal Enterprises, said in a statement that the approval of the NCLT on the deregulation of our Pharma business and the simplification of the corporate structure is a significant milestone. We are on track to complete the demerger and separate listing of Piramal Pharma by the third quarter of the current financial year. The company, in connection with the composite scheme of the arrangement, had already received approval from RBI, SEBI, stock exchanges, and clearances from our creditors and equity shareholders.

The bank is expected to create one of India's largest listed diversified non-bank financial companies NBFCs with a loan book of around $9 billion, and would have a significant presence across retail and wholesale financing.

After the demerger, both Piramal Enterprises and Piramal Pharma's performance is projected to improve over the next several years, since they will be more focused and able to pursue faster expansion, according to the statement. In exchange for the decreeping, PEL shareholders will receive 4 shares of PPL in addition to their current holding of PEL for every 1 share of PEL.

The pharma company will have revenues of more than $1 Billion and will be a large listed entity in the pharmaceutical sector. Piramal said that it offers a portfolio of differentiated products and services through end-to- end manufacturing capabilities across 15 global facilities and a global distribution network of over 100 countries.