Source Reuters
MUMBAI — Shares of Novartis India Ltd skyrocketed by 20% on Friday, hitting their upper circuit limit, following the official announcement that Swiss pharmaceutical giant Novartis AG will exit its majority stake in the Mumbai-listed entity.
The deal, valued at approximately $159 million (₹1,446 crore), marks the conclusion of a multi-year strategic review as the parent company shifts its global focus toward high-margin, innovative “pure-play” medicines.
The Transaction Details
Novartis AG has entered into a definitive share purchase agreement to sell its entire 70.68% stake (1.74 crore shares) to a consortium of private equity investors. The buying group is led by ChrysCapital, along with WaveRise Investments and Two Infinity Partners.
Sale Price: The shares are being sold at ₹860.64 per share.
Mandatory Open Offer: Following Indian market regulations, the consortium has launched an open offer to acquire an additional 26% stake from public shareholders at the same price.
Timeline: The transaction is expected to be finalized by the third quarter of 2026.
Market Reaction: A 20% Surge
Despite the sale price being set at ₹860.64—a modest 3.6% premium over Thursday’s close—investors reacted with overwhelming optimism. The stock surged to ₹996.50 on the Bombay Stock Exchange (BSE), as the market welcomed the clarity provided by the exit of the Swiss promoter and the entry of seasoned private equity backers.
Why the Move?
The divestment is part of a broader corporate restructuring. Novartis has been steadily moving away from its “established medicines” portfolio (older, off-patent drugs like the painkiller Voveran) to focus on cutting-edge therapies in oncology, immunology, and neuroscience.
Notably, this deal only affects the listed entity (Novartis India Limited). Novartis AG will maintain its presence in the country through its wholly-owned subsidiary, Novartis Healthcare Private Limited, which manages:
Commercial operations for innovative drugs.
The Hyderabad-based Global Capability Center (GCC).
R&D teams overseeing clinical trials at over 300 sites in India.
Company Statement: “Upon completion, Novartis will complete its transformation into a pure-play innovative medicines company… we remain deeply committed to India through our more than 9,000 associates.”
Branding Changes
As part of the agreement, the Indian unit must undergo a complete rebranding. The entity is required to remove all references to the “Novartis” name within 120 days of the deal closing, signaling a total break from the Swiss parent’s brand identity in the Indian public market.
