Cipla South Africa makes strategic move to acquire Actor Pharma for US$48.6 million

SOUTH AFRICA — Cipla Ltd.’s wholly-owned South African subsidiary, Cipla Medpro South Africa Ltd., has entered into a binding term sheet to acquire Actor Holdings (Pty) Ltd., a privately owned pharmaceutical company specializing in consumer health and generic medicine.

The acquisition, valued at ZAR 900 million (approximately US$48.6 million or around Rs 400 crore) in cash for a 100% equity stake, marks a pivotal moment in Cipla’s expansion plans within the South African market.

Cipla’s strategic move to acquire Actor Pharma is driven by the desire to tap into future growth prospects and capitalize on cost synergies.

While the financial specifics of the deal were not disclosed in the announcement, the strategic importance of the acquisition is unmistakable.

Actor Pharma, founded in 2009, has emerged as the fifth largest privately owned over-the-counter (OTC) player in the South African private market.

It specializes in OTC and generic medicines, boasting established consumer brands and a strong presence in niche prescription markets. These niches include women’s health, nasal health, cough and cold remedies, as well as baby and child care.

The shareholding pattern of Actor Pharma reveals that promoters hold 33.47% of the company, with foreign institutional investors holding 25.49% and domestic institutional investors holding a 24.33% stake.

This strategic acquisition aligns with Cipla’s vision to reinforce its investment in the OTC business and solidify its position as a prominent healthcare provider in South Africa.

Cipla South Africa anticipates unlocking future growth opportunities and cost efficiencies through this venture.

Cipla’s upcoming acquisition in South Africa is inching closer to completion as it awaits the signing of the share purchase agreement, expected within the next 14 days.

This pivotal transaction is set to conclude within a maximum of four months from the agreement’s signing, contingent upon approval from the South African Competition Commission.

Umang Vohra, Cipla’s Global Managing Director and Chief Executive Officer, emphasized the significance of this move, stating, “This is in line with our strategy of strengthening our OTC and wellness portfolio.”

Meanwhile, Paul Miller, Chief Executive Officer of Cipla South Africa, highlighted the unique opportunity presented by the acquisition, describing it as a means to bolster Cipla’s over-the-counter (OTC) portfolio.

He emphasized that this development would lead to a more balanced revenue contribution between prescription and OTC businesses while continuing to deliver quality medicines to consumers.

South Africa occupies a prominent position in the African pharmaceutical landscape and is classified as one of the 21 global pharmerging markets by IQVIA.

These markets, while currently holding a lower position in the global pharma market, are experiencing rapid growth.

The South African pharmaceutical market is currently dominated by generic drugs and boasts robust manufacturing capabilities.

As Cipla’s acquisition progresses, it signifies a strategic move within the thriving South African pharmaceutical sector.

With the pending agreement and promising market potential, Cipla’s presence in South Africa is set to become even more impactful.

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