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Virendra Verma

Mumbai , Dec. 8

THE stock prices of Pfizer India and Pharmacia Healthcare gained on Monday's trading on market expectation of a possible merger between the two companies.

On Monday, the stock price of Pfizer gained 6.57 per cent to Rs 521.05 on the BSE, with a volume of 59,496 shares; on the NSE, it closed at Rs 519.40, up 6.35 per cent, with 1.05 lakh shares changing hands. Pharmacia Healthcare gained 15.17 per cent to Rs 168.20 on the BSE, with a volume of 41,403 shares, and on the NSE, it closed at Rs 167.30, up 14.55 per cent, with a volume of 60,504 shares.

Brokers and analysts said, in line with the global merger of these two companies in April this year, a merger in India is also expected. Pfizer India's parent, Pfizer Corporation, holds 32.56 per cent in the company; its other promoters, Warner Lambert Company and Parke Davis & Company, hold 4.12 per cent and 3.32 per cent, respectively, taking the total promoters' stake to 40 per cent. In Pharmacia Healthcare, Pharmacia Corporation has 75.12 per cent.

However, an analyst with a foreign broking firm said, "The merger between the two companies is expected, but the main issue would be the merger ratio. In case the ratio is favourable to a particular company's shareholders, then the market may not like the merger in the short term."

After the global merger, the two companies have been integrating their business and the same is expected in India, the analysts said. They also expect Pfizer to increase its stake in its India's affiliate to 51 per cent. The market is expecting Pfizer's parent to make an open offer once the merger is complete to further consolidate holding in its Indian venture.

After the merger, Pfizer reported loss of $3.6 billion, however, the analysts said this would not be possible in India as both the companies are profit-making.

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