Pharma major Dr Reddy’s Laboratories has entered into a definitive agreement with Wockhardt Ltd to acquire select divisions of its branded generics business in India, Nepal, Sri Lanka, Bhutan and the Maldives, for ₹1,850 crore. The business undertaking is being transferred on a slump sale basis.
Wockhardt’s branded generics business comprises a portfolio of 62 brands in multiple therapy areas such as respiratory, neurology, VMS, dermatology, gastroenterology, pain and vaccines. This will be transferred to Hyderabad- based Dr Reddy’s along with the related sales and marketing teams, apart from a manufacturing plant located in Baddi, Himachal Pradesh, with all its employees.
“India is an important market for us and this acquisition will help in considerably scaling up our domestic business,” GV Prasad, Co-Chairman and Managing Director, Dr Reddy’s, said in a release on Wednesday.
High-growth therapy areas
The acquired portfolio will enhance Dr Reddy’s presence in high-growth therapy areas with brands such as Practin, Zedex, Bro-zedex, Tryptomer and Biovac, the release said.
“We believe the portfolio holds a lot of potential and will get an impetus under Dr Reddy’s. We welcome the team joining as part of the deal to the Dr Reddy’s family,” Prasad added.
The transaction is expected to be closed in the first quarter of FY21.
The Dr Reddy’s scrip was trading flat at ₹3,191 on the BSE on Wednesday, while Wockhardt’s scrip lost 2.33 per cent over the previous close to trade at ₹384.30.