Kilitch Drugs (India) Limited is exiting its Ethiopian subsidiary in a $14 million deal, sharpening its focus on domestic manufacturing, debt reduction and expansion into high-growth pharmaceutical segments, including GLP-1 therapies.
The pharmaceutical company has announced the strategic divestment of its entire shareholding in Kilitch Estro Biotech PLC (KEB) to HarmeeCare Pharmaceuticals, an Ethiopian state-owned enterprise. The proposed transaction, approved by the company's Board of Directors, is expected to be completed by January 31, 2027, subject to shareholder approval, regulatory requirements and completion of the necessary documentation.
The move marks a strategic realignment for Kilitch Drugs as it seeks to unlock capital, strengthen its balance sheet and redirect investments towards its core pharmaceutical operations in India.
Kilitch Drugs plans to use the net proceeds from the sale to reduce existing borrowings, lower finance costs and support the phased expansion of its new manufacturing facility at Pen, Maharashtra.
The Pen facility is central to the company's next phase of growth. The company plans to manufacture liquid injectable vials, lyophilised (freeze-dried) injectable vials and ophthalmic eye drops at the site, building on its established expertise in aseptic manufacturing.
It also plans to develop and manufacture GLP-1 (Glucagon-Like Peptide-1) therapies, positioning itself to tap the fast-growing segment as patents on key molecules expire across international markets.
The company is also targeting EU GMP (European Union Good Manufacturing Practice) and PIC/S (Pharmaceutical Inspection Co-operation Scheme) accreditations to strengthen its presence in regulated export markets. These expansion plans remain subject to applicable regulatory approvals.
Commenting on the proposed transaction, Bhavin Mehta, Whole-Time Director, Kilitch Drugs (India) Limited, said: “Our focus is on building the next phase of Kilitch Drugs’ growth by strengthening our manufacturing capabilities and expanding our presence in high-potential pharmaceutical segments.
"The strategic divestment of our Ethiopian subsidiary will enable us to unlock capital, strengthen our balance sheet and accelerate our expansion plans in India. With our new Pen facility coming on stream in phases, we see significant opportunities to leverage our manufacturing experience, participate in emerging therapy segments such as GLP-1 and deepen our presence in international regulated markets. We believe these initiatives will position Kilitch Drugs for sustainable, long-term growth.”
Despite exiting ownership of its Ethiopian subsidiary, Kilitch Drugs intends to maintain a commercial foothold in the country.
The company proposes to enter into a long-term supply and technical services agreement with HarmeeCare Pharmaceuticals. The arrangement is expected to support the continued operations of the Ethiopian manufacturing facility while preserving an ongoing commercial relationship in the region.
