Nestle India Ltd. invested Rs 705.5 crore in a joint venture with Dr Reddy's Laboratories Ltd. that caters to nutritional health solutions. The company subscribed 70.55 lakh equity shares of Dr. Reddy's and Nestlé Health Science Ltd. on a rights basis, according to an exchange filing on Thursday. Nestle India owns 49% of the JV.
A part of this investment will be used to fund the acquisition of Nestle India's existing medical nutrition and nutraceuticals business for Rs 218.9 crore. The food and beverage major executed a business transfer agreement for the slump sale.
Nestle India and Dr Reddy's announced their tie-up in April.
The joint venture will bring together the well-known global range of nutritional health solutions as well as vitamins, minerals and health supplements of Nestlé Health Science with the nutraceuticals portfolios, strong and established commercial strengths of DRL, Nestle India said.
The company was incorporated on March 14 of this year.
Shares of Nestle India closed 1.14% higher at Rs 2,484.05 apiece, ahead of the announcement, as compared to a 0.15% advance in the benchmark BSE Sensex.
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