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Nicholas buys ICI's drug business for Rs 70 cr

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Mr Ajay Piramal, Chairman, Nicholas Piramal India Ltd, with Mr Vijay Shah, ED & COO, at a press conference in Mumbai on Friday.

MUMBAI, Jan. 25

PHARMACEUTICAL major Nicholas Piramal India Ltd (NPIL) has acquired the pharmaceutical business of ICI (India) Ltd for Rs 70 crore in an all-cash deal, on a going concern basis.

The amount includes Rs 14 crore towards acquiring net current assets of ICI and Rs 1 crore to NPIL by ICI towards transaction costs.

The deal includes ICI's key brands and its manufacturing facility at Ennore, near Chennai, with 150 employees.

Announcing the deal, Mr Ajay Piramal, Chairman, NPIL, said that with the latest acquisition, the company had become the number one player in the cardiovascular segment. ICI's pharma sales amounted to Rs 69 crore in 2000-2001.

This is the second acquisition by the company in the past two years. In 2000, it had acquired Rhone-Poulenc India.

It is also the latest in a series of acquisitions by the company, vaulting it into the league of Rs 1,000-crore pharma firms.

The acquisition of the ICI business brings with it key brands in the cardiovascular segment, such as Tenormin, Inderal, Zestril and Tenochlor, which will catapult NPIL to the number one position in the Rs 1,300-crore India cardiovascular market.

The other players in the segment are Cipla, Zydus Cadila, Torrent Pharmaceuticals and Sun Pharmaceuticals.

Mr Piramal said, "This acquisition is significant for our presence in high-growth segments such as cardiovascular, central nervous system and critical care segment. The niche or speciality bulk drugs that are exported by the business have no competition from India and limited international competition.''

ICI's pharma business has about 357 employees, including a field force of 200.

"We plan to integrate the acquisition into our business. Of the 200-strong field force, 150 are from the cardiovascular segment. We could absorb them into our cardiovascular division,'' said Mr Vijay Shah, Executive Director, NPIL. Co-promotion of products is also an option that is being explored, he added.

The pharma business of ICI has posted sales of Rs 69 crore in the 2000-01 fiscal, with domestic sales at Rs 52 crore and exports at Rs 17 crore.

Segment-wise, cardiovascular sales accounted for Rs 36 crore, critical care Rs 8 crore, dermatology Rs 7 crore and others Rs 4 crore.

For the 2001-02 fiscal, the sales are estimated at Rs 76 crore, Mr Piramal said.

The Nicholas Piramal scrip closed on the Bombay Stock Exchange at Rs 224.70, while the ICI scrip closed at Rs 74.05

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