Financial Daily from THE HINDU group of publications
Sunday, Apr 25, 2004
Financial Daily from THE HINDU group of publications Sunday, Apr 25, 2004 |
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Corporate
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Overseas Borrowings Jubilant Org to raise $55 m to fund European acquisitions Ambarish Mukherjee
New Delhi , April 24 THE over Rs 700-crore Jubilant Organosys is in the process of raising $55 million (about Rs 23,650 crore) for acquiring two pharmaceutical companies in Europe. One of the companies has a large number of formulations to its credit with approved dossiers as well as several dossiers in the pipeline expecting approval by the concerned country's drug authority shortly. The second company is a formulation trading company. Jubilant will acquire 80 per cent stake in both the companies. Company officials, who declined to name the companies they are looking at acquiring citing commercial reasons, told Business Line that both the companies were promoter-driven owned by a lady scientist, who herself has developed some of the formulations. "The move is aimed at forward integration. As of now we are already into bulk drugs. So the next step to move up the value chain would be to enter into formulations. And with these acquisitions we will have a substantial number of final products in our fold ready for marketing," officials said. They added that, "However, for now, we will stick to the generic products only and will not enter the branded pharmaceuticals market because we do not have the distribution network." The formulations under the fold of the European company are in the areas of cardiovascular system, central nervous system, respiratory disorders, diabetes and general infections. The company would fund the acquisitions partly through internal accruals and partly through external debts. Officials said that the board had set up a four-member committee headed by the Chairman-cum-Managing Director, Mr Shyam S. Bhartia, to finalise the modalities of raising $55 million from the international market. "Earlier, we had taken shareholders' approval for raising funds through the GDR route. Considering the present market condition, the board has approved the foreign currency convertible bond as well as the private placement route. The exact combination would be worked out by the committee. It may be a combination of various modes of financing also," officials said. The acquisition is expected to be completed by the end of the first quarter as the necessary due diligence and regulatory clearances in both the countries would require anywhere between four to eight weeks' time. Jubilant Organosys is engaged in the manufacture of life science chemicals, performance chemicals and industrial chemicals. During the first nine months ending December 2003, the company has reported a net profit of Rs 54.6 crore on a turnover of Rs 628.6 crore.
More Stories on : Overseas Borrowings | Pharmaceuticals | Mergers & Acquisitions
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