Strides Arcolab has signed a definitive agreement to acquire fellow Indian drugmaker Grandix Pharmaceuticals in a move that will give the firm a domestic presence.
Strides is one of India's largest exporters of branded generic pharmaceutical products but is now looking at the domestic market, hence it is paying 100 crores (approximately $24 million) on a cash and debt free basis to gain control of Grandix. The transaction will be accretive to Strides’ earnings per share.
Grandix is particularly strong in the southern part of India and its sales last year reached 48.50 crores, and are expected to rise over 30% in 2007, while earnings before interest, taxes, depreciation and amortisation were up 22% to 10.89 crores. Strides added that India is amongst the fastest growing pharmaceutical markets in the world and the acquisition “will be the springboard to launch a national presence by leveraging existing Grandix products with the company's strong R&D pipeline”.
Getting hold of Grandix means that Strides will have a sales force of 400 by the end of July, the firm concluded. It has 14 manufacturing plants spread across the US, Brazil, Mexico, Italy, Poland and Singapore, as well as in India, employs around 1,700 people and has a marketing presence in over 50 countries.