The Hindu Business Line : Matrix Labs to pick majority stake in Concord Biotech

IN YET another consolidation move, Matrix Laboratories Ltd has decided to acquire controlling stake in Concord Biotech Ltd, an Ahmedabad-based closely held biotechnology company.

Concord has fermentation and bio-catalytic technology capabilities and is one of the few biotech plants in the country to have been approved by the USFDA for an API (active pharmaceutical ingredients) manufacturing facility.

"Fermentation and bio-catalytic capabilities are a few areas where Matrix is missing out at present and the acquisition enables us to offer a complete portfolio of products," the Matrix Executive Chairman, Mr N. Prasad, told Business Line.

Concord's product portfolio consists of Lovastatin, Pravastatin, Simvastatin, Tacrolimus, Mycrophenolate Mofetil, Cyclosporin and Penicillin-G Amidase enzyme. The company has also filed drug master files for Lovastatin, Simvastatin and Tacrolimus with the USFDA.

"We have signed the term sheet with the promoters of Concord for the acquisition here on Tuesday. A definitive agreement will be executed in a couple of months," Mr Prasad said. As per the term sheet executed, Matrix will acquire 55 per cent stake in Concord through a combination of purchasing of existing equity shares from the promoters and other shareholders of Concord and also subscribing to new equity shares of Concord through preferential allotment basis.

Following the acquisition, the main promoter and Managing Director of Concord, Mr Sudhir Vaid, and his associates will hold 29 per cent stake in Concord, while the other existing shareholders will have 16 per cent holding. As per the understanding, Mr Vaid and his team will continue to spearhead the company's operations under the guidance of the board in which Matrix will have majority representation.

The Executive Chairman of Matrix Labs, Mr N. Prasad, said, "Our investment in Concord Biotech is in line with our strategic intent to acquire fermentation technology and manufacturing capabilities. This is a key step in the evolution of Matrix and has come in at a time when the major fermentation-based products are going off patent in the international markets. This investment will add statins, enzymes and immuno-suppressants to our product portfolio and hence widen the range of products offered to Matrix's customers."

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