GSK to buy a $150 million stake in Dr Reddy's?

Reports from India are claiming that GlaxoSmithKline is in talks to buy a 5% stake in Dr Reddy's.

The report, published by the country’s The Economic Times, says that the transaction could be worth about $150 million, and that a deal could be closed within two months. A link-up of some sort would appear to make sense given that GSK signed a deal in June to get access to Dr Reddy’s “rich and diverse” portfolio and future pipeline.

Under that deal, Dr Reddy’s would also manufacture products licensed and supplied by GSK in countries such as Africa, the Middle East, Asia Pacific and Latin America, but not India. However, the Indian drugmaker recently made it clear that it will not be offering up a major chunk of the firm.

Earlier this month, Dr Reddy’s responded to press reports, saying that its founders “have no intention of diluting their stake”, which is thought to be between 23%-26%, and such a move “is purely a market speculation". Its response came after the Times of India claimed that such a deal could take place.