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Business News/ Companies / Emcure to buy divested assets of Sun Pharma and Ranbaxy
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Emcure to buy divested assets of Sun Pharma and Ranbaxy

With CCI approval for the purchase, all hurdles have been cleared in the Ranbaxy-Sun Pharma merger, now expected to close in the current fiscal

Earlier this month, the Punjab and Haryana high court had approved the merger between Sun Pharmaceutical Industries and Ranbaxy Laboratories. Photo: Hemant MishraMintPremium
Earlier this month, the Punjab and Haryana high court had approved the merger between Sun Pharmaceutical Industries and Ranbaxy Laboratories. Photo: Hemant MishraMint

Mumbai: During the divesture, Sun Pharma will sell all products containing Tamsulosin+Tolterodine, which are currently marketed and supplied under the Tamlet brand name. On the other hand, Ranbaxy will sell off all products marketed and supplied under the brand names of Eligard, Terlibax, Rosuvas EZ, Olanex F, Raciper L and Triolvance.

With this approval, all hurdles have been cleared in the transaction between Ranbaxy and Sun Pharma, which is now expected to close in the current fiscal year. Sun Pharma agreed to acquire Ranbaxy in April last year to create India’s largest pharmaceuticals company.

Earlier this month, the Punjab and Haryana high court had approved the merger. In January, the deal had received approval from the US Federal Trade Commission (FTC), which was examining the deal under its antitrust laws. The commission waived a key waiting clause, allowing the two firms to hasten the merger.

CCI also noted that according to data from AIOCD Pharmasofttech AWACS Pvt. Ltd, a pharmaceutical market research company, out of the seven divestment products to be acquired by Emcure, there was horizontal overlap in respect of two products between the existing products of Emcure and Rosuvastatin + Ezetimibe and Olmesartan + Amlodipine + Hydrochlorothiazide. However, both pharma companies and Emcure have submitted that there are certain errors in the data provided by AIOCD AWACS and there are no overlaps between the two.

CCI said that even if the errors in the AIOCD AWACS data are ignored, the market share of Emcure in the two overlapping products is insignificant and thus, the horizontal overlap, if any, is not likely to result in any appreciable adverse effect on competition, thereby approving the sale.

On 3 February, all parties had submitted a detailed proposal along with the agreed form of the asset purchase agreement (APA) and a supply agreement (SA). CCI had appointed PricewaterhouseCoopers Pvt. Ltd as the monitoring agency in this case to supervise the modifications.

Sun Pharma, India’s biggest drug maker by market value, had agreed to acquire Ranbaxy Laboratories, controlled by Japan’s Daiichi Sankyo Co. Ltd, in an all-stock deal worth $3.2 billion that created the world’s fifth largest generics drug maker by revenue.

Under India’s merger and acquisition rules, companies need CCI’s approval if the combined assets of the two entities are worth more than 1,500 crore or sales amount to more than 4,500 crore in India.

Shares of Sun Pharmaceutical Industries lost 0.3% to close at 1,024 apiece, while those of Ranbaxy Laboratories fell 0.24% to 804.60 apiece on BSE on Monday. The Sensex shed 0.24% to close at 28,192.02 points.

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Published: 23 Mar 2015, 07:54 PM IST
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