Mumbai-based drugmaker Cipla Ltd is acquiring 51 per cent stake in a UAE-based pharmaceutical company which has manufacturing and distribution business in Yemen for $21 million.
“Given the recent preference to local manufacturing, this secures the company’s presence in a fast growing market,” the company said in a stock exchange announcement.
At present Cipla has over 200 products in Yemen market. The company will pay $21 million for this transaction with additional considerations which would be paid over three years on achievement of milestones.
Cipla has been aggressively acquiring businesses especially in overseas markets. This is the company’s second acquisition in June. Earlier this month, the company acquired 60 per cent stake in a Sri Lankan company for $14 million.
In 2013, the company acquired its distribution partner in South Africa - Cipla Medpro South Africa - Ltd for around $512 million. This was company’s first acquisition in three years. In 2010, the company acquired stake in Meditab Specialities Pvt Ltd, Mab Pharm and a drug formulation facility in Sikkim.
The firm is also backing start-ups and mid-capital companies through its investment arm Cipla New Venture (CNV). Earlier last month, CNV invested $1.5 million in US-based drug development company Chase Pharmaceuticals Inc to pick up 14.6 per cent.
The development comes in the wake of Indian pharmaceutical market seeing significant consolidation and M&A activity. Earlier this year, Sun Pharma announced that it is acquiring Ranbaxy in a $4 billion deal. Ahmedabad-based Torrent Pharma has just completed a previously announced deal to acquire domestic formulation business of Elder Pharma for Rs 2,004 crore.
(Edited by Joby Puthuparampil Johnson)