Shares of Cipla Ltd gained over 1% in Wednesday's trade after the company divested 51.2% in its arm for $25-30 million.
The company in an exchange filing said that along with its units it entered into a share purchase agreement with Africa Capitalworks SSA 3 for sale of 51.18% stake held in Cipla Quality Chemical Industries Ltd, Uganda, for $25-30 million.
The company's wholly-owned subsidiaries involved in the deal are Cipla (EU) Ltd, UK and Meditab Holdings Ltd, Mauritius.
According to the exchange filing, Cipla Quality Chemical Industries will no longer be a subsidiary of the company after the sale.
"Cipla Quality Chemical Industries contributes 2.57% to Cipla's total revenue. Consideration to be received by Cipla (EU) and Meditab Holdings shall be in the range of USD 25-30 million, which shall be subject to annualised audited earnings before interest, taxes, depreciation, and amortisation (EBITDA) of Cipla Quality Chemical Industries for FY23," said the company.
The proposed sale is expected to be completed by May 31.
The buyer, Africa Capitalworks SSA 3, is a wholly-owned subsidiary of Africa Capitalworks Holdings, which is an investment management company incorporated in Mauritius.
However, on the technical front, the company has made a new 52-week low in the past seven days, and is trading near its 52-week low.
The stock's weekly average delivery volume is 63.47%.
"Short trend is negative as recent selling witnessed high volumes which could also lead to relative underperformance," said Ruchit Jain, lead research, 5paisa.com.
