Jubilant to acquire Max India's pharma division

Wednesday, 04 September 2002, 07:00 Hrs
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NEW DELHI: Jubilant Organsys, India's largest specialty chemicals maker, Wednesday said its board has approved acquisition of the diversified Max India's pharmaceutical division for 690 million.

At the meeting of the board of directors in Mumbai, Jubilant announced its decision to acquire Max India's pharmaceuticals manufacturing facilities at Nanjangud in Mysore, said a Jubilant notice to the Bombay Stock Exchange.

"Jubilant Organosys will pay Max India 622 million and also incur transaction related expenses of 68 million, bringing the entire cost of acquisition to 690 million," the statement said.

"The final price and completion of the transaction is subject to a detailed due diligence exercise and statutory approvals."

Max India had last week denied media reports that Jubilant Organosys was in advanced stage of negotiations to buy Max's bulk drugs business.

Though there were other suitors for Max's bulk drugs business, Jubilant was the front-runner. Analysts say the divestment of the New Delhi-based Max India's bulk drugs division is part of a drive to exit non-core businesses.

Max India has interests in a wide spectrum of industrial sectors such as healthcare, insurance, clinical studies, information technology and packaging.

Max's pharmaceuticals division, a leading maker of non-penicillin drugs, had sales of 625 million in the last fiscal year to March and profit before tax of 69.4 million.

"We are confident of as well as committed to building a leading market position in the high growth segment that is a value-led extension of our specialty chemical business," said J.M. Khanna, president of Jubilant Organosys.

"This acquisition provides us with established manufacturing, marketing and research and development related strengths that we will aggressively utilize our business objectives for the future."

Max shares were up 6.07 percent at 93.50, while Jubilant shares were down 0.82 percent at 212.50 on the Bombay Stock Exchange in the early trade.

Source: IANS
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