Zydus Lifesciences shares fall 4% as it acquires 50% stake in Sterling Biotech

The stock was trading 4.6% lower at ₹1,121.1 apiece on the National Stock Exchange (NSE) at 11:05 am. Its market capitalisation stands at ₹1.13 lakh crore.

Zydus Lifesciences to acquire 50% stake in Sterling Biotech

As per the deal, Perfect Day Inc, which is a Temasek portfolio company, will sell its 50% stake in Sterling Biotech for an undisclosed amount.

Zydus Lifesciences said in a statement that Sterling Biotech will become a 50:50 joint venture (JV) with equal representation on the Board after the transaction.

The JV will set up a manufacturing unit to produce fermented animal-free protein for global markets.

The Gujarat-based firm said the acquisition also marks the company's entry into specialised biotech products for health and nutrition, primarily catering to consumers who like animal-free protein or suffer from lactose intolerance.

Perfect Day's precision-fermented protein is found in cream cheese, ice creams, baked goods and sports nutrition products, which have high functionality benefits and lower environmental impact.

Sterling Biotech is currently manufacturing and selling fermentation-based API products and gelatine.

"We are dedicated to promoting growth through partnerships and are consistently exploring new collaborations to position India as a premier global supply chain hub," Zydus Lifesciences MD Sharvil Patel said.

He added that the collaboration with Perfect Day Inc. creates a win-win combination that leverages both strengths and expertise to create value for consumers.