Cipla Limited did not give much away at its annual general meeting (AGM) on speculation around a potential stake sale by the founding Hamied family, with its octogenarian chairman instead referring to investments in newer modalities and technologies that will chart the future course of the "evergreen" company.
Stake Sale News
Cipla's chairman Dr Yusuf Hamied termed news around a potential stake sale by the founding family as "speculative" but didn't go all the way with an outright rebuttal, at least for now.
“All the news you are hearing is speculative. All the clarifications for that, which we made to the stock exchange and whatever information was given to the stock exchange, is in public domain and is public knowledge. So, whatever you want to know, please do get it from the stock exchange,” Hamied said at the AGM. (Also see "Will More Indian Family-Owned Firms Hand Over The Baton To PEs?" - Scrip, 31 July, 2023.)
A few Cipla shareholders raised questions on the speculated stake sale, with one saying that potential foreign buyers could raise prices of medicines, much to the detriment of the wider public.
“Do not sell the company. We are with you; the middle class will suffer,” one shareholder cautioned at the AGM.
CNBC TV18 had earlier reported that Cipla’s founders were in talks with major private equity (PE) players to sell part of their 33.47% holding in the company. Blackstone and Baring Asia were among those said to be in talks to explore a deal.
In a filing with the Bombay Stock Exchange on 27 July, Cipla said it wasn’t aware of any event that requires disclosure under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirement) Regulations 2015.
“The company will make appropriate disclosure in compliance with the Listing Regulations as and when any such requirement arises,” it said at the time.
Cipla’s stake sale speculation has also drawn the attention of politicians in India, with a senior leader of the Congress Party taking to social media, noting that it was “painful” to learn that Blackstone may be negotiating to acquire the entire promoter stake in Cipla
Addressing the 87th AGM, Cipla’s non-executive chairman Yusuf Hamied referred to the many partnerships and significant investments made by the Indian firm in newer therapies such as mRNA, CAR-T cell
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