(Adds details on deal, Aspen debt)
Nov 11 (Reuters) - Aspen Pharmacare Holdings agreed to sell its Japanese operations to Novartis' Sandoz for up to 400 million euros ($440.80 million) through a unit as it looks to cut debt, the South African drugmaker said on Monday.
Investors have been concerned about Aspen's rising debt after levels moved close to breaching debt covenants. The nearly 170-year old drugmaker has said it aimed to reduce debt levels from the 2020 financial year.
The company's unit, Aspen Global Incorporated (AGI), will also transfer all its shares in Aspen Japan K.K to Sandoz and any related intellectual property as part of the deal expected to be completed in the first half next year.
Sandoz will pay Aspen 300 million euros upfront, and the remaining 100 million euros upon completion of certain milestones.
Aspen, which also operates in Europe, has trimmed debt to 39 billion rand ($2.62 billion) from 53.5 billion rand, mostly due to cash proceeds from disposal of its infant formula business and a portfolio of products distributed in Asia Pacific.
AGI also agreed to supply to Sandoz the ingredients, semi-finished and finished products related to the brands it had sold, for an initial term of five years.
$1 = 0.9074 euros $1 = 14.8839 rand Reporting by Pushkala Aripaka in Bengaluru; Editing by Shailesh Kuber