Friday, March 16, 2007

Zydus Cadila acquires Liva Healthcare

Ahmedabad-based pharma company Zydus Cadila has acquired a 97.5% stake in Liva Healthcare in an all-cash deal. The acquisition will be funded through cash accruals and debt.

Zydus expects the acquisition of Liva Healthcare will help the former to establish its presence in the Rs. 1500 crores derma segment, seventh largest therapeutic segment in the Indian pharma market. The market for dermatology products has grown at a CAGR of 14.1% over the last three years.

Zydus’ domestic formulations business contributes to over 50% of the group's turnover with as many as 17 brands amongst the top 300 pharma brands in India. In the participated segments, the group is a leader in the cardiovascular, gastro-intestinal, women's healthcare segments and has a strong presence in the respiratory, pain management and anti-infective segments.

Liva Healthcare is growing at more than 15%. It is a profit making company and it is likely to post sales in excess of Rs. 37 crores in 2006-07. Zydus Cadila has a turnover of Rs. 1800 crores. In the past, the group acquired Recon Healthcare, German Remedies, Banyan Chemicals and Alpharma France.

Read the article in Business Standard.

Sun Pharma to hive off R&D work into new company SPARC

Sun Pharmaceuticals will spin off its research and development (R&D) activities into a new company called Sun Pharma Advanced Research Company (SPARC). The transfer will include the company’s New Chemical Entity (NCE) and New Drug Delivery System (NDDS) programmes, which have an estimated 100 scientists.

Sun Pharma will infuse $45 mn into the new company, to enable it to sustain its operations until revenues from out-licensing deal start flowing in. The company could be looking at raising funds for its new company through equity or debt. It is planning to invest $60 to $65 mn in the new research company in the next three years. Research for generic drugs will remain with the main company.

The de-merger will offer investors an option to separately hold investments in businesses with different return characteristics, depending on their risk and return expectations. The new research company, SPARC, is being valued at more than $450 mn. Simultaneously, the de-merger of Sun Pharma’s innovative R&D business could significantly de-risk the company’s core business.

Read the article in The Economic Times.

UTI Mutual Fund poaches top Sundaram BNP Paribas fund manager Anoop Bhaskar

The Times of India reports that Anoop Bhaskar of Sundaram BNP Paribas Mutual Fund, and one of the top fund managers in the industry, will join UTI Mutual Fund. Anoop Bhaskar is the head of equities at Chennai-based Sundaram BNP Mutual Fund. He will join UTI Mutual Fund in the same position. Bhaskar is one of the most active, and one of the better-performing fund managers in the Indian mutual fund industry.

Spices company McCormick planning to acquire Indian spice firms Eastern, Lalah's

US-based McCormick, the world’s largest spice and seasoning company, is scouting for other Indian companies after its failure to buy MTR Foods, later bought by Orkla Foods of Norway. McCormick is looking at some other South-based spice brands such as Eastern and Lalah’s.

The Rs. 170 crore-Eastern is one of the bigger local players in the packaged spices market. Eastern, with a predominant presence in the southern markets, has been interested in a better national spread through the inorganic route. Private equity firm New Vernon is already an investor in the company. It’s learnt that the McCormick team had also visited other players in the packaged spice market such as MDH and Lalah's.

McCormick’s joint venture company in India, the Kochi-based AVT McCormick, engaged in processing and exports of spices, is reportedly helping the US company with its acquisition plans. McCormick’s Indian JV, which kicked off in 1994, exports Rs. 100 crores worth of value-added spices to developed markets. AVT has over eight decades of experience in agri-business including rubber, tea and a portfolio of spices.

Read The Economic Times article.

Chinese aluminium firm buys 50% stake in Indian plant

The Times of India reports that Chinese aluminium firm Qingtongxia Aluminium Group is acquiring a 50% stake in an aluminium project of Ashapura Minechem in western India. The outlay on this project is somewhere around $651 mn. This is the first, and the biggest, Chinese investment in India in the aluminium sector. Qingtongxia has obtained approval from the National Development and Reforms Commission, the country's top planning body. The proposed facility will have an annual capacity of 1 mn tonnes annually.

IndusInd Bank to issue GDRs worth Rs. 140 crores by March-end

The Hinduja Group-controlled IndusInd Bank is planning to raise around Rs. 140 crores through global depository receipts (GDR) by March 2007. The bank will issue close to 30 mn shares which will listed at the Luxembourg Stock Exchange. CLSA has been appointed as the lead manager to the issue. The fresh infusion of capital will bring the promoter holding down to about 28% from 31.3%. The foreign holding in the bank will increase to 25 % from about 17%. The GDR issue will help enable the bank to boost its capital adequacy ratio to 11.25% from 11.10%. It is also planning to raise Rs. 50 crores through issuance of lower Tier-II bonds. The post-issue paid-up capital of the bank will rise to Rs. 320 crores from Rs. 290 crores.

The capital raising will enable IndusInd to pursue new business lines like wealth management and asset reconstruction. It is also planning to expand its presence overseas by setting up an offshore banking unit in Singapore. At present, the bank has representative offices in Dubai and London.

Read more on IndusInd Bank in the article in Business Standard.

Areva ups bid price for REpower to €140 / share; Suzlon mulling counter-bidding options

It seems to be the seasons for biddings and counter-biddings. French energy major Areva has upped the price for acquiring Germany’s third-largest wind power company, REpower Systems AG, by putting in a counter-bid of €140 per share. Areva had earlier made an offer to buy stake in REpower at €105 per share, and its revised offer is 33.3% higher than the first bid. The new figure is 11.1% higher than the Suzlon Energy-Martifer's offer of €126 per share. Suzlon had recently received the approval of German regulator for its bid for REpower Systems. It had offered €1.2 bn ($1.33 bn) to acquire REpower Systems.

Read the Business Standard article.
Related Post:
Suzlon Energy bids $1.3 bn for German company REpower

It is learnt that Suzlon Energy is likely to revise its offer to buy out REpower. The company is in talks with a consortium of banks led by ABN-AMRO and may come out with a revised offer of close to €160 per share, which will raise the value of REpower to $1.7 bn. Areva’s revised offer has raised the value of REpower to $1.5 bn.

REpower, Germany’s third-largest maker of wind-power equipment behind Vestas Wind Systems and Enercon, reported a profit of €7.1 mn in 2006. In Germany, REpower has a 10% market share.