The Indian unit of French drug-maker Sanofi SA has finalised a deal to buy out Elder Pharma’s domestic formulation business in a transaction estimated at around Rs. 2,400 crore, sources familiar with the development said.
The deal would give the Paris-headquartered multinational access to several popular medicinal drugs, including calcium brand Shelcal, and Chynoral, a blood-thinning agent.
Sources said the deal is likely to be announced in a fortnight. Emails and phone calls to Elder Pharma for comments or confirmation did not elicit any response. “We do not believe in commenting on rumours in the markets,” said a Sanofi India spokesperson, without confirming or denying the reported deal.
Founded in 1989, Mumbai-based Elder Pharma, which had a turnover of `1,233 crore in the fiscal year ended March, has manufacturing and marketing interests that cover pharmaceuticals, surgical equipment and medical devices.
Industry analysts said the French giant would gain from a strong portfolio of brands owned by the Indian company, which is ranked at 29 in the country’s pharma industry in terms of sales revenues.
“Sanofi India and Elder Pharma will be in focus on reports that French drug maker Sanofi SA’s Indian arm was close to acquiring Elder Pharma’s domestic formulation business for over Rs. 2,400 crore,” said a brokerage report on the deal.
Shares of Elder pharma closed at Rs. 318, down 4.2%, on the Bombay Stock Exchange on Monday. Sanofi India’s shares were down 0.7% atRs. 2,353.
“The Indian pharma space is attractive, and it has the potential to grow faster than the rest of the economy in India,” said an analyst at a domestic brokerage.
The `70,000-crore domestic pharma sector in India is growing at about 15% per annum. The industry’s export value is also roughly of the same size.
Source: hindustantimes
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