1. Mechanism:

   • The OFS mechanism is a transparent process, typically used by promoters of publicly traded companies to sell shares.
   • It is conducted on the stock exchange over a specific period, allowing a wide range of investors to participate.

2. Eligibility:

   • OFS can be used by companies listed on a recognized stock exchange in India.
   • Only the promoter/promoter group entities can offer shares through this mechanism.

3. Process:

   • Announcement: The seller (Glenmark Pharma in this case) announces the details of the OFS, including the number of shares on offer, floor price, and the date of the sale.
   • Bidding: Investors can place bids for the shares during the OFS period. The bids can be at or above the floor price.
   • Allotment: Shares are allotted to bidders based on the bids received, typically on a proportionate basis if there is oversubscription.

4. Regulations:

   • The OFS process is regulated by the Securities and Exchange Board of India (SEBI), which sets guidelines to ensure transparency and fairness.

Implications for Glenmark Pharma and Glenmark Life Sciences:

1. Glenmark Pharma:

   • Liquidity: The sale of this stake will provide liquidity to Glenmark Pharma, which can be used for various purposes such as debt reduction, funding new projects, or other strategic investments.
   • Valuation Realization: The sale through OFS allows Glenmark Pharma to realize the value of its holding in Glenmark Life Sciences based on current market prices.

2. Glenmark Life Sciences:

   • Market Perception: The sale of shares by the promoter can impact market perception. However, since this is a sale through an OFS, it is typically seen as a routine financial transaction rather than a reflection on the company’s fundamentals.
   • Shareholding Pattern: The stake sale will lead to a change in the shareholding pattern of Glenmark Life Sciences, potentially increasing the free float and liquidity of the stock in the market.