Biocon Ltd has announced a definitive agreement to divest its enzymes business vertical to Novozymes for USD 115 million. This will enable the company to strategically focus on its core bio-pharmaceuticals business. The enzyme business includes a broad range of industrial enzymes, food additives and process aids. This transaction, subject to shareholder and regulatory approvals, is expected to he completed by the end of the 3rd quarter of CY 2007.

Upon the completion of this divestment, the company will concentrate its activities on its bio-pharma business verticals that include APIs, biologicals and proprietary molecules both commercialised and under development.

Announcing the new development, Kiran Mazumdar-Shaw, CMD of the company said, "Over the past decade we have clearly recognized the high growth trajectory of our bio-pharma business verticals and have progressively invested to build proprietary know-how and global scale. We believe that this is the right time to divest our enzymes business and focus on unleashing the full potential of our Bio-pharma businesses.

Novozymes as the recognized world leader in enzymes will be in a strong position to leverage our existing enzymes portfolio built over a span of nearly three decades.

The company's enzyme business will be integrated into Novozymes South Asia Pvt Ltd a fully owned affiliate of Novozymes production and formulation will continue at the company site under lease and service agreements with Novozymes.

The company's board of directors unanimously recommended the sale, subject to certain limited conditions normal in a transaction of this nature including the approval of Biocon's shareholders.

The agreement has been signed on July 18, 2007 and will seek shareholders approval by postal ballot to be initiated shortly. The two companies expect the business transfer agreements to he approved by appropriate authorities and the transaction is expected to be dosed before the end of Q3 CY 2007.

Allegro Capital Advisors acted as the company's investment bankers to the transaction.