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Mumbai , Sept 29

THE board of directors of Glenmark Pharmaceuticals Ltd has approved the conversion of debentures issued to CDC Financial Services (Mauritius) Ltd and South Asia Regional Fund into equity shares at a price of Rs 305.42 per share (The scrip closed at Rs 393.45 on BSE on Monday). This has resulted in an allotment of 818,557 equity shares to each of these entities, informed a company release.

While this move will dilute the promoter's stake to 54.59 per cent from 63 per cent, CDC and South Asia Regional Fund would now own 14.36 per cent of Glenmark Pharmaceuticals. The Mumbai-based firm is a research-based pharmaceutical company specialising in segments such as dermatology, internal medicine, ENT and diabetes. During June 2002, Glenmark had taken the option to exercise conversion of debentures into equity shares for a Rs 270- Rs 325 band based on the financial results of 2002-03.

"At that period the share price was in the Rs 200 range. If compared to that the price might seem lower, however it must be understood at the sector has been re-rated since and what has been offered gives a 50 per cent increase in premium," a company spokesperson said.

Following the decision to convert the debentures, the paid-up equity share capital of the company will increase from Rs 10.19 crore to Rs 11.83 crore and the reserves and surplus from Rs 132.39 crore to Rs 180.75 crore. This would also allow the company to reduce the secured debt by Rs 50 crore. The secured debt stood at Rs 124 crore during the end of the financial year 2002-03, according to Mr V.S.Mani, Vice President-Finance.

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