Coimbatore :
Elder Pharmaceuticals and Torrent Pharmaceuticals have announced that Torrent has entered into a definitive binding agreement with Elder to acquire its branded domestic formulations business in India and Nepal for a consideration of Rs 2,004 crore.
Elder’s India business comprises a portfolio of over 30 brands with leading products across women’s healthcare, pain management, wound care and neutraceuticals therapeutic segments.
The India business is being sold as a going concern on a slump sale basis and the transaction would involve the transfer of employees engaged in sales, marketing and operations. Under the proposed transaction, Elder would continue to manufacture and supply products at its existing manufacturing facilities for Torrent for three years.
Torrent would fund the acquisition through a mix of internal accruals and bank debt. Elder’s existing brand equity in the areas of women’s healthcare and pain management would help Torrent strengthen its position in the Indian market expanding into these fast growing areas, the companies said in a statement.
“We will now focus and grow our in-licensing, anti-infectives and exports business,” said Alok Saxena, Managing Director and CEO, Elder. “The transaction is a strategic fit for Torrent and will strengthen its core prescription-based business,” said Sudhir Mehta, Chairman, Torrent Group.
“This acquisition strengthens our position in women healthcare, pain management and vitamins/nutrition segments by enhancing and accelerating market access,” he said. “It is also expected to enable cost and revenue synergies in Torrent’s domestic formulations business,” Mehta said.
The transaction has been approved by the board of directors of both the companies. The transaction is subject to shareholder approval and applicable regulatory approvals and is expected to close in the first half of 2014.
source: http://www.articles.timesofindia.indiatimes.com / The Times of India / Home> City> Coimbatore> Pain Management / by M. Allirajan, TNN / December 13th, 2013