InvestorQ : Why is Aurobindo selling its US affiliate company, Natrol LLC?
Sam Eswaran made post

Why is Aurobindo selling its US affiliate company, Natrol LLC?

Moii Chavate answered.
8 months ago

Hyderabad based pharma major, Aurobindo, will sell Natrol LLC to a Private Equity firm for a consideration of approximately $550 million. Natrol LLC is currently a subsidiary of Aurobindo of the US. Blue Mountain is the PE fund taking the stake in Natrol from Aurobindo.

Natrol LLC is huge in the entry level segment in the sense that it had annual sales of $157 million in the full year and this money would be used by Aurobindo to defray part of its debt to various lenders and reduce its financial risk in the books.

Aurobindo boasts of having one of the best product and ANDA pipelines in the Indian pharma industry and that is what has sustained growth. Aurobindo has also gotten over most of the FDA related problems that it had suffered in the last 3 years.

Moreover, this unit sale will allow Aurobindo Pharma to re-allocate its resources in favour of more productive avenues by reducing their debt. Aurobindo is also confident that Blue Mountain will be in a better strategic position to invest additional funds into Natrol to create a better business proposition.