Business Daily from THE HINDU group of publications
Saturday, Mar 15, 2008
ePaper | Mobile/PDA Version
Business Daily from THE HINDU group of publications Saturday, Mar 15, 2008 ePaper | Mobile/PDA Version |
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Corporate
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Overseas Investments Vivimed Labs eyeing two acquisitions in US, Europe
G Naga Sridhar Hyderabad, March 14 Vivimed Labs, a speciality chemical and Home and Personal Care (H&PC) company, is likely to acquire two companies in the US and Europe. The Hyderabad-based company, which has acquired UK-based James Robinson last month, is currently in talks with the target firms, and the acquisition is almost certain, Mr Santosh Varalvar, Managing Director of Vivimed Labs, told Business Line here, while declining to give names of the firms and timeframe for the deals. The Rs 140-crore company (2006-07) believes that an inorganic growth path is the best way, given the global potential for H&PC products. Inorganic growthVivimed, which is a qualified supplier of ingredients to over 30 global personal care products, is planning to shift the manufacturing of James Robinson’s products to India. “In India, there is a 20-25 per cent cost advantage and we will shift its product manufacturing to India by September 2008,” he said. “As we speak today, the markets and major manufacturers in H&PC are purely Western. The segment is yet to be explored by Indian companies. So, in order to establish approvals from the buyers, the viable approach is inorganic growth,” Mr Varalvar said. Market shareThe global H&PC market is estimated at $275 billion, with 12 per cent growth per annum. In this, ingredients have a $25-30-billion share. Australia and Asia have a 1 per cent share in this, while India’s share is below 0.5 per cent and there is lot of scope for a middle-tier company like Vivimed, he explained. The company, which operates two plants — one each in Bidar (Karnataka) and Bonthapally (Andhra Pradesh) — has lined up capacity addition with an investment of Rs 40 crore. It is setting up a new plant in Visakhapatnam, costing Rs 50 crore, by 2009-end. This would increase the total capacity from the present 650 kilolitres to 1,000 kilolitres, he added. In the speciality pharma division, which pools in 30 per cent of the revenue, Vivimed is working on anti-TB and anti-hypertension drugs in addition to its existing anti-cancer range. “We had begun our business as an Active Pharmaceutical Ingredients (APIs) player. We will continue our pharma focus. By 2010, our revenues will come equally from H&PC and speciality pharma,” Mr Varalvar said. Vivimed is expecting to clock a revenue of Rs 195 crore, with about Rs 20 crore as net profit this fiscal year. “By 2009-10, the proposed acquisitions and organic growth will make us a Rs 400-crore company,” he claimed. More Stories on : Overseas Investments | Mergers & Acquisitions | Pharmaceuticals
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