Strides Pharma: How to compute cost of acquisition of shares post-demerger between Strides Pharma and Onesource

The demerger scheme between Strides Pharma Science and Onesource has been approved by the NCLT.

Strides Pharma Science has provided guidance on the post-demerger cost of acquisition and the allocation between Strides and Onesource shares. It has explained how to split the cost of acquisition between Strides and Onesource shares.

“FOR THE ATTENTION OF SHAREHOLDERS OF STRIDES PHARMA SCIENCE LIMITED (‘THE COMPANY’)

The National Company Law Tribunal, Mumbai Bench, vide its Order dated November 14, 2024 has
approved the Scheme of Arrangement between Strides Pharma Science Limited (the ‘Company’ or
‘Strides’), Steriscience Specialities Private Limited (‘Steriscience’) and Onesource Specialty Pharma Limited (‘Onesource’) and their respective shareholders (‘Scheme’) in terms of Sections 230-232 of the Companies Act, 2013.

The Scheme, inter-alia, provides for the following:

a) Demerger of Identified CDMO Business and Soft Gelatin Business of Strides (Demerged Undertaking 1) into Onesource (“Transferee Company” or “Resulting Company”);

b) Demerger of Identified CDMO Business of Steriscience (Demerged Undertaking 2) into Onesource (“Transferee Company” or “Resulting Company”).

Strides had fixed December 06, 2024, as the Record Date to determine the eligibility of its equity
shareholders who would be entitled to receive the equity shares of Onesource, pursuant to the Scheme.

In terms of the Scheme, Onesource is required to issue and allot, to each shareholder of Strides whose name appears in the Register of Members of Strides and/ or in the Depositories as Equity Shareholder of Strides as on the Record Date, One fully paid-up equity share of Rs. 1/- each of Onesource, for every Two fully paid-up equity shares of Rs. 10/- each of Strides, held by such equity shareholder in Strides.

For the purpose of determining the Cost of Acquisition (COA) of the equity shares of the Company and Onesource (post demerger), you are advised to split your COA of equity shares in the Company in the following manner:

Name of the Company % of Cost of Acquisition of Equity Shares

Strides Pharma Science Limited 89.35%
Onesource Specialty Pharma Limited 10.65%
Total 100.00 %

For Example

A shareholder holds 60 shares (having face value of Rs. 10/- each) in Strides before the Record Date i.e., December 06, 2024 at a price of Rs. 1,000/- per share. Total cost of acquisition of 60 shares is Rs. 60,000. Such shareholder will be allotted 30 fully paid-up equity shares (having face value of Rs. 1/- each) of Onesource for 60 shares held in Strides.

The proportionate COA of 30 shares of Onesource shall be INR 6,390 (i.e., INR 213 per share) and that of 60 shares of Strides shall be INR 53,610 (i.e. INR 893.50 per share).

Further, according to the provisions of Section 47 (vi) (d) of the Income Tax Act, the issue of shares of the Resulting Company i.e., Onesource to the equity shareholders of the Demerged Company 1 i.e., Strides pursuant to the Scheme is not a transfer and hence not taxable in the hands of the equity shareholders.

In respect of the equity shares to be issued by Onesource, the date of acquisition of such equity shares, for the purpose of capital gains in the hands of the shareholder, will be the date of acquisition of the original shares of Strides for each shareholder, as per clause g of Explanation 1 to section 2 (42A) of the Act

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