Cipla doyen Hamied labels sale reports as “speculative”

Cipla doyen YK Hamied labelled as “speculation”, recent reports on the promoter family selling their stake in the Mumbai-based drugmaker to private equity players.

Hamied was addressing shareholders at the company’s 87^th Annual General Meeting, and his statement is the first public utterance from a member of the promoter-family.

Addressing concerns raised by shareholders, right at the top of the questions-and-answers session, Hamied said the news was speculative and the company had clarified to the stock exchanges. 

Shareholder concerns

Earlier in the session, one of the shareholders outlined concerns on affordable medicines, voiced by many Cipla-watchers, and said, “We are with you, do not sell the company.” The shareholder pointed out that a foreign company would raise the price of medicines and the middle-class would suffer. Cipla had put itself on the global map by supplying affordable HIV/AIDS medicines to Africa. Another shareholder also appealed to Hamied to “draw a line” on the sale.

The shareholders were referring to reports that the US-based PE firm Blackstone was poised to pick up the promoter family’s equity (33.47 per cent) in the company — a move that would trigger an open-offer, ending in controls moving out from the existing dispensation.

In fact, Hamied’s statement came even as a television report said that Blackstone had submitted a non-binding bid along with its limited partners to acquire control in the drugmaker.

Future-ready

Hamied’s opening statement at the shareholder meeting also did not allude to reports of a possible sale of promoter equity. Instead, he spoke of Cipla’s work to address AMR (anti-microbial resistance - as a result of antibiotics misuse); incremental innovation to repurpose essential drugs and the partnerships to build a Cipla of the future, with a focus on mRNA, stem-cells, CAR-T and digital therapeutics.

Cipla Managing Director and Global Chief EXecutive, Umang Vohra, pointed to the company’s healthy performance in India, the US and South Africa, and added that they were working on a new strategy for the coming years. This involved building on their “lung leadership”, with products in this segment accounting for 30 per cent of the company’s revenues; wellness products (accounting for 9 per cent) and AMR-focussed drugs. 

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