Natco Pharma to Demerge Agrochemicals Arm, Approves Nigeria Entry and Australia Exit
New Delhi: The Board of Directors of Natco Pharma Limited has approved a Scheme of Arrangement for demerger of its agrochemicals business into a separate entity, along with plans to incorporate a wholly owned subsidiary in Nigeria and liquidate its Australian subsidiary, marking a significant strategic restructuring move by the company.
The decision was taken at the board meeting held recently, where the company approved the scheme between Natco Pharma Limited (demerged company) and Natco Crop Health Sciences Limited (resulting company). The appointed date for the scheme has been fixed as October 1, 2026.
As part of the arrangement, the agrochemicals business, comprising research, development, manufacturing, and marketing of products such as pesticides, insecticides, herbicides, and bio-stimulants, will be transferred to the resulting company on a going concern basis. The pharmaceutical business, which includes APIs and formulations across therapeutic areas like oncology, cardiology, neurology, and diabetology, will remain with Natco Pharma.
The board noted that the demerger is aimed at segregating two distinct business verticals with different risk and return profiles, enabling focused growth, operational efficiency, and better resource utilization. The move is also expected to unlock value for shareholders and allow each business to pursue independent growth opportunities and attract strategic investors.
In terms of share entitlement, the resulting company will issue one fully paid-up equity share of ₹2 each for every one equity share of ₹2 held in Natco Pharma. Post demerger, shareholders will directly hold around 80% stake in the resulting company, while Natco Pharma will retain approximately 20% stake.
The agrochemicals division reported a turnover of ₹60.62 crore, contributing about 1.48% to the company’s total turnover for the financial year ending March 31, 2025.
Additionally, the board approved incorporation of a wholly owned subsidiary, Natco Pharma Nigeria Limited, with an investment not exceeding USD 100,000, aimed at expanding its pharmaceutical business in Nigeria. The company will hold 100% stake in the proposed entity.
Further, Natco Pharma also approved the liquidation of its wholly owned subsidiary, Natco Pharma Australia Pty Ltd, citing lack of economic viability and changes in business model, with closure expected by September 2026.
The scheme is subject to necessary approvals from stock exchanges, shareholders, creditors, and the National Company Law Tribunal (NCLT). Upon implementation, the resulting company will seek listing on BSE and NSE.
