Strides Arcolab completes acquisition of Indian Domestic Pharma Company - Grandix Pharmaceuticals Ltd

Strides Arcolab Ltd on June 11, 2007 has announced that it has signed a definitive agreement to acquire 100% of Grandix Pharmaceuticals Ltd and its subsidiary Grandix Laboratories Ltd on a cash and debt free basis valuing 100% of the Company at Rs 100 crores (Approximately US$ 24 million].

The transaction is accretive to Strides EPS and offers a platform to grow a domestic strategy by infusing a robust Strides pipeline.

Pricewaterhouse Coopers acted as an independent valuer of the transaction.

- Grandix is a branded pharmaceutical Company mainly focused on the South of India.

- For the FY 2006, Grandix posted sales of Rs 48.50 crores (US $ 11.80 million) and EBITDA of Rs 10.89 crores (US $ 2.60 million)- 22%.

- Sales in 2007 is expected to grow at over 30%.

Strategic Rationale:

- India is a major pharmaceutical market and amongst the fastest growing markets in the world.

- The Company has no domestic presence and Grandix will be the springboard to launch a national presence by leveraging existing Grandix products with the Company's strong R&D pipeline.

- The Company will increase Medical representative's strength to 400 by end July 2007 and will expand gradually to cover the entire country.

- Grandix management brings the branding expertise for the Company's growing branded business worldwide.

Speaking on the occasion Arun Kumar, Vice Chairman and Managing Director, stated "we are delighted with this very strategic acquisition of Grandix and its leadership. We are confident that the acquisition will create a differentiated local operation in the Indian domestic pharma space".

Source : Equity Bulls

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