The Hindu Business Line : Dishman spreads wings in Europe

Bright Future
On August 11, deal between Dishman, Carbogen and Amsis will be closed
Two SEZs coming up at Kerala village near Bavla in Ahmedabad district
The Group wants to consolidate on gains to make the company profitable

Ahmedabad , Aug. 4

Pharma major Dishman Pharmaceuticals and Chemicals Ltd, having acquired a Swiss company through its subsidiary in Europe earlier this year, is now spreading its wings further in Switzerland through a deal with two more companies.

SEZ plan

Simultaneously, it is also setting up two special economic zones (SEZs) near Ahmedabad for engineering and fine chemicals, its Managing Director, Mr Janmejay R. Vyas, said early this week.

On August 11, the $74.5 million-deal between Dishman and the Switzerland-based Carbogen and Amsis will be closed. The sale and purchase agreement was signed with the Swiss duo in June this year, Mr Vyas told Business Line here.

Carbogen is a contract research company while Amsis is engaged in development of anti-cancer drugs. The two companies are worth 15 million Swiss francs while Dishman has dished out six times that amount in the deal, he added.

"Dishman intended to create additional capacity for the two Swiss companies in India by making them available cheaper raw material. Instead of us investing for them in Europe, we would be investing, for them, in India in terms of capacity expansion, profitability and turnover," Mr Vyas pointed out.

More SEZs

Also, the company's Board of Directors' meeting approved the setting up of two SEZs at Kerala village near Bavla in Ahmedabad district. Each of these SEZs would be spread over about 150 hectares and the two will collectively entail an investment of Rs 600 crore.

The company is proceeding ahead with approvals from both the Gujarat and the Central Governments, he said, adding that Dishman has already identified land for the purpose. The company would develop these SEZs by end-2008.

Asked about Dishman's plans to engage in fresh mergers-and-acquisitions, Mr Vyas said, as of now, the Group wanted to consolidate the gains and create synergies to make the company profitable. The company had recently invested Rs 40 crore for this purpose.

Strengthening the gains

The 16-year-old company, now having a turnover of Rs 277-crore, hadset up a modern, cent-per cent export-oriented production facility, near Ahmedabad in 1997, to emerge as a contract-manufacturing organisation. In April 2005, it suddenly caught attention of investors with its first public offer. At the same time, Dishman acquired a Manchester-based contract research company through its 100 per cent, wholly-owned subsidiary Dishman Europe Ltd.

In February 2006, it acquired IO3S, Switzerland, through its wholly-owned subsidiary, M/s Dishman Switzerland Ltd. In May this year, it successfully went through the US Food and Drug Administration audit, wherein the FDA auditors recommended it for PI approval.

In June 2006, it filed Drug Master File in Europe for two sophisticated molecules developed by its R&D wing, proposing to start a disinfectant formulation division with an investment of Rs 5 crore.