Sanofi's API Unit Euroapi Set for Paris Stock Exchange Spin-off Listing

Compiled by Draven

It is reported that Euroapi, a subsidiary of Sanofi, will be spun off and listed on the Paris Stock Exchange. The company stated last Friday that Sanofi will hold 30% of Euroapi's shares in the proposed spin-off and will continue to hold them after the transaction. In addition to the previously proposed cash dividend of 3.33 euros per share, the Sanofi board proposed to submit to shareholders a distribution plan of approximately 58% of Euroapi's equity. Additionally, the French Tech Souveraineté fund has agreed to purchase 12% of Euroapi's shares from Sanofi for 150 million euros.

The issuance of dividends will take place shortly after Euroapi's listing on Euronext Paris, subject to the approval of the French Financial Markets Authority (AMF).

In 2020, Sanofi divested its active pharmaceutical ingredients (API) business to create Euroapi, as it aimed to shift resources toward oncology and immunology development, API, and low-margin sectors. At the time, companies like Pfizer, GlaxoSmithKline, and Merck also adopted strategies of divesting or selling parts of their businesses to focus on high-margin products and popular research areas such as oncology. Additionally, Novartis, Roche, and Teva reduced their old tablet production facilities to revamp their manufacturing networks, opting instead to invest in new biologic or gene therapy facilities.

Nowadays, Covid-19 has reinforced the necessity of pharmaceutical supply chains in Western countries. Euroapi will also become the world's largest small molecule active pharmaceutical ingredient (API) producer and the second-largest API producer this year. The company’s product portfolio includes more than 200 APIs, which have been approved for use in 80 markets worldwide.

According to reports, Euroapi positions itself as an EU alternative in the API market dominated by raw materials primarily produced in India and China. With six production bases in Europe, its sales are expected to reach 1 billion euros this year.

Reference Source: Sanofi Prepares API Spinoff for Paris Exchange Listing, Shareholders Reap Dividend