Singapore-based
pharmaceuticals company Invida has agreed to acquire New Delhi's Shalaks
Pharmaceuticals for $25 million (Rs 125 crore) or three times its revenue.
"The deal is done and will be announced
soon," a person familiar with the development said.
Shalaks promoter and chairman VK Nangia
neither confirmed nor denied that a deal had been concluded. Invida's general
manager in India Girdhar Balwani declined to comment. Invida was advised on the
acquisition by Mumbaibased MAPE Advisory Group.
Shalaks makes and markets prescription and
over-the-counter skincare products like sunscreen lotions, skin rash creams,
soaps and cosmetics. It had revenues of Rs 40 crore in fiscal 2011.
In 2010, the Indian dermatology market grew
21% and had an estimated value of $513 million (Rs 2,565 crore), or 25% of the
Asia-Pacific dermatology market, according to estimates on Invida's website.
The $200-million Invida, which started out
providing contract sales forces to multinational drug companies, like Pfizer,
in key Asian markets in 2005, has also been building its own specialty product
portfolio through in-licensing and acquisitions.
In 2008, it bought the Asia-Pacific operations
of California-based Valeant Pharmaceuticals. In 2010, it acquired 70% in
Indonesian drugs manufacturer MUGI.
However, partnering continues to be an
important pillar of its strategy, especially since MNCs are keen on ramping up
their presence in fast growing emerging markets.
In March, UK drug firm Sinclair
Pharmaceuticals, which specialises in dermatology and wound-care products,
added India to a list of 11 markets in which Invida has the exclusive rights to
market Sinclair brands. Invida has 1,000 sales representatives in India,
according to a report on its website.
Invida is co-owned by US-based clinical
research organisation Quintiles, Temasek Holdings, and Zuellig group, which has
a large distribution and supply chain management network in the Asia-Pacific.
Since 2008, the pace of M&As in the drug
industry has increased as Indian promoters - facing tightened domestic patent
laws and challenging business and regulatory environment - are wooed by
bulge-bracket MNCs ready to pay hefty premium to scale up their presence in the
Indian market.
For instance, last year Piramal Healthcare
sold its local prescription drugs unit to Abbott for Rs 17,000 crore or nine
times the sales figure. But a combination of the global economic uncertainty
and hefty domestic valuations has seen bigticket deals drying up in recent
months.
Source:
Business & Investment Opportunities
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