Mumbai based Sun Pharma said in a statement on Monday that they are acquiring Indian drug maker Ranbaxy laboratories in a $4 billion deal (Rs. 24,000 crore).
The merger will make Sun pharma world’s fifth largest generics company and India’s largest pharmaceutical company. Ranbaxy is India’s number one drugmaker by sales. Japan’s Daiichi Sankyo has 63.4 per cent share in the company.
Ranbaxy has been banned from exporting drug ingredients to the United States and Sun Pharma’s Karkhadi plant is also barred from shipping products to the US. For each Ranbaxy share, the shareholders will receive 0.8 share of Sun Pharma implying a value of Rs. 457 for each Ranbaxy share.
After the deal Daiichi Sankyo will hold about 9 per cent stake in Sun Pharma. Managing Director of Sun Pharma Dilip Shanghvi said that Ranbaxy provides a strong platform that is complementary to Sun Pharma’s strengths and they see tremendous growth opportunities.
India supplies medicines to more than 200 countries and is also the second largest supplier of drugs to the United States. Indian drugmakers, among the biggest producers of generic medicines at cheap prices have come under scrutiny amid quality and safety worries.
Sun Pharma shares shed 1.2 per cent lower price at Rs. 571.90 while Ranbaxy shares closed at Rs. 459.55, 8.2 per cent higher on Friday.
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