The Hindu Business Line : Jubilant to buy 75% equity in US generics co

JUBILANT Organosys has signed a memorandum of understanding to acquire 75 per cent equity in a US generics company. Along with this, the board of directors has also approved a proposal to raise funds up to $100 million through the FCCB/GDR/ADR or any other equity related instrument to fund acquisitions and capital expenditure.

Company officials were not willing to divulge the name of the company that is being acquired citing "confidentiality", but said that Jubilant will make an initial payment of $8.25 million to the existing shareholders of the company and invest another $12 million as capital to grow the business over the next two years.

According to an official statement, "The company to be acquired is in the business of generic drugs and has a FDA approved manufacturing facility in the US. It has five approved abbreviated new drug approvals (ANDAs) and another three ANDAs are awaiting approval. In addition, the company also has a pipeline of 14 products of which ANDAs for five products are expected to be filed during the calendar year 2005. These will be complemented by 10 ANDAs that Jubilant Organosys will develop for the target company."

Commenting on the proposed acquisition, Mr Shyam S. Bhartia, Chairman and Managing Director, said, "The acquisition is in line with our strategic intent of expanding our presence in the regulated markets. Last year, we moved in this direction by acquiring pharmaceutical companies in Belgium to have presence in the European markets and the US acquisition will help us enhance our presence in the world's largest generics market."

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