IN RE Vs. SOLARA ACTIVE PHARMA SCIENCES LIMITED

JUDGEMENT

(1.) Perused the Company Scheme Application, along with the Affidavit dated 6th September, 2017 of Mr. S. Murali Krishna, Authorized Signatory of the Applicant Company, in support of the Company Scheme Application and heard Mr. Tapan Deshpande, Advocate for the Applicant Company.

(2.) The proposed Composite Scheme of Arrangement between Strides Shasun Limited ("Demerged Company 1") and Sequent Scientific Limited ("Demerged Company 2") and Solara Active Pharma Sciences Limited ("Applicant Company"/"Resulting Company") , (hereinafter referred to as the "Scheme" or the "Scheme of Arrangement") and various other matters consequential to or otherwise integrally connected with the Scheme, pursuant to Sections 230 to 232 and other relevant provisions of the Companies Act, 2013 provides for transfer by way of a demerger of the commodity active pharmaceutical ingredients business ("Commodity API Business") undertaking of the Demerged Company 1 and the human active pharmaceutical ingredients business ("Human API Business") undertaking of Demerged Company 2 into the Resulting Company undertaking of Demerged Company 2 into the Resulting Company and issuance of shares by the Resulting Company to shareholders of the Demerged Company 1 and Demerged Company 2 in consideration for transfer of the respective undertakings. The rationale for the Scheme is as follows (a) the Commodity API Business and Human API Business, being "B2B" businesses, require a differentiated strategy and direction to grow and deliver value; (b.) Segregation of the Commodity API Business from the other core "B2C" businesses of Demerged Company 1 will allow concentrated focus by Resulting Company management on the Commodity API Business and Demerged Company 1 management on its other core B2C businesses - (i) Segregation of the Human API Business from the animal healthcare business of Demerged Company 2 will allow concentrated focus by Resulting Company management on the Human API Business and Demerged Company 2 management on the animal healthcare business; (ii) The unbundling of Commodity API Business and Human API Business and consolidation into Resulting Company will create an active pharmaceutical ingredients company in India with critical size, and is expected to unlock value by enabling the business activities to be carried out with greater focus and specialization for sustained growth; (iii) the demergers are expected to enhance shareholder value for shareholders of both Demerged Company 1 and Demerged Company 2; and (iv) the Scheme is expected to be in the best interests of the shareholders, employees and the creditors of each of the Demerged Company I, Demerged Company 2 and the Resulting Company.

(3.) The Applicant Company has no secured creditors and unsecured creditors as on 23rd August, 2017. In view of the foregoing and in view of the provisions of Section 230 of the Companies Act, 2013, the following directions are issued: