The Hindu Business Line : Emami may not have it easy on Zandu Pharma

Emami’s move to acquire Zandu Pharmaceutical Work through a buyout of one of the two promoter groups may not be smooth if one goes by what the other promoter group is saying.

Sources close to the Parikh family, which now holds around 18 per cent in Zandu, said that they viewed the move by Emami as “undesirable” and were looking at suitable legal options to stall the takeover.

Mr Harsha Agarwal, ED of Emami as also member of the Emami promoter family, however, was not available for comment. Earlier, Mr Agarwal had clarified to Business Line that Emami had not yet opened a communication channel with the Parikhs on management control or working together with them after acquiring 24 per cent stake from Vaidyas, one of the Zandu’s promoter groups, last week.

With 27.5 per cent stake under its belt and the proposed open offer, Emami aimed to mop up 47.5 per cent voting rights in Zandu. According to market sources, this not only would represent majority stake among the promoters, but also close to controlling stake.

Parikhs, currently are well entrenched in Zandu and Mr Girish Parikh, is the managing director of the company. . He is also a director on the board of Zandu Chemicals Ltd, a wholly owned subsidiary of Zandu. According to market sources, the Parikh family is seeing Emami’s gesture as a “hostile” move.

Sources suggest that there are corporate bodies in the public investors category in Zandu, who are linked to Parikhs. Moves are afoot to garner a counter-offer against Emami open offer.

After a recent strong rally, Zandu stock today finished with a decline of 2.13 per cent to close at Rs 9,509.45, still higher than the open offer price of Rs 7,315.

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Emami comes out with open offer for Zandu

More Stories on : Mergers & Acquisitions | Pharmaceuticals

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