The Hindu Business Line : Biocon gets FIPB nod to hike foreign equity stake to 60 pc

THE Bangalore-based Biocon India Ltd has received permission from the Foreign Investment Promotion Board to increase the foreign equity stake in the company's paid-up equity capital to 60 per cent.

Currently, the foreign equity in the company's paid-up capital is about 38 per cent though it has the Government's approval for a foreign stake to the extent of 43.60 per cent. The company has also received the Government's nod to transfer equity shares held by Biocon India Ltd Welfare Trust to four internationally renowned scientists who are currently among the company's scientific advisors. These scientists include Dr Charles L. Cooney, Professor of Chemical & Biochemical Engineering, Massachusetts Institute of Technology, and the present Chairman of the company's scientific advisory board;Dr Bala Manian, Chairman and co-founder of Entigen and co-founder Quantum Dot Corporation and SurroMed Corporation, all based in California; and Dr Anthony Allison, a distinguished molecular scientist at SurroMed Corporation and former Vice- President of Research Syntex Corporation and the inventor of the crucial molecule Mycophenolate Mofetil.

Biocon India, the largest biotechnology company in the country, has announced plans to go public during the current year. It has also announced plans to go ahead for international listing before the domestic listing. Its earlier plan to hit the market in 2003 was postponed several times due to various reasons.

The company also has around 35 patents to its credit. It is engaged in manufacturing chemicals and chemical products in the field of biotechnology and human insulin using recombinant DNA technology.

The company also has a joint venture subsidiary with the Cuba-based Centre for Molecular Immunology (CMI) to manufacture and market a select range of biotechnology products for human healthcare. Biocon India holds 51 per cent stake in the joint venture company — Biocon Biopharmaceuticals Pvt. Ltd. — while CIMAB, the commercial arm of CMI, has a 49 per cent stake.

Interestingly, this was the first instance of a joint venture company in India with foreign equity participation in which the Government permitted issuing of equity shares to the foreign partner for consideration other than cash on the basis of valuation of the technology provided by the collaborator.

More Stories on : Mergers & Acquisitions | Pharmaceuticals

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