AsianScientist (Apr. 9, 2014) – Indian biotech company Sun Pharmaceutical Industries Ltd. will acquire 100 percent of the generics manufacturer Ranbaxy in an all-stock transaction. The transaction has a total equity value of approximately US$3.2 billion.
The combination of Sun Pharma and Ranbaxy creates the fifth-largest specialty generics company in the world and the largest pharmaceutical company in India. The combined entity will have operations in 65 countries, 47 manufacturing facilities across five continents and a significant platform of specialty and generic products marketed globally, including 629 abbreviated new drug applications (ANDA).
Sun Pharma expects to realize revenue and operating synergies of US$250 million by third year post closing of the transaction. These synergies are expected to result primarily from topline growth, efficient procurement and supply chain efficiencies. As part of the transaction, Sun Pharma intends to leverage the human capital that has supported both companies, in order to drive future growth.
Dilip Shanghvi, Managing Director of Sun Pharma said, “Ranbaxy has a significant presence in the Indian pharma market and in the US where it offers a broad portfolio of ANDAs and first-to-file opportunities. In high-growth emerging markets, it provides a strong platform which is highly complementary to Sun Pharma’s strengths.”
The proposed transaction has been unanimously approved by the Boards of Directors of Sun Pharma, Ranbaxy and Ranbaxy’s controlling shareholder, Daiichi Sankyo. Ranbaxy’s board and Sun Pharma’s board have recommended approval of the transaction to their respective shareholders.
Daiichi Sankyo, which holds approximately 63.4 percent of the outstanding shares of Ranbaxy, will become a significant shareholder of Sun Pharma and will have the right to nominate one director to Sun Pharma’s Board of Directors.
The closing of the transaction will be subject to customary closing conditions, including approval by the Indian Central Government, approval by the High Courts of Gujarat, Punjab and Haryana, as well as approval by the Competition Commission of India and expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvement Act in the United States. Pending approvals, Sun Pharma anticipates that the transaction will close by the end of calendar year 2014.
——-
Source: Sun Pharmaceutical Industries Ltd.
Disclaimer: This article does not necessarily reflect the views of AsianScientist or its staff.
