The world’s largest drug maker Pfizer is consolidating two public listed arms in India by merging Wyeth Ltd with Pfizer Ltd. Pfizer had acquired Wyeth globally four years ago through a merger agreement but had retained separate listed firms in the country and the merger would house its business under a single entity.
As per the scheme of amalgamation, the shareholders of Wyeth India will be issued seven shares of Pfizer India for every 10 shares of Wyeth. Pfizer India will issue around 15.9 million new equity shares to Wyeth India shareholders.
Pfizer currently owns 70.75 per cent of Pfizer India while 51.12 per cent of Wyeth India. Post-merger, its holding in the combined entity will be around 63 per cent.
The board of directors of Pfizer India and Wyeth India have also announced an interim dividend of Rs 360 and Rs 145 per share, respectively.
“The combined entity would have an increased therapeutic presence and a de-risked business profile. The merger process would require several approvals and we anticipate this will take approximately nine months more,” said Aijaz Tobaccowalla, managing director of Pfizer India and Wyeth India.
DSP Merrill Lynch Ltd and Citigroup Global Markets India Pvt Ltd are the financial advisors to Pfizer India and Wyeth India, respectively. Ernst & Young LLP acted as the tax advisors to Pfizer India and AZB & Partners is acting as the legal advisor.
In Oct 2009, Wyeth USA merged with Wagner Acquisition Corporation, a wholly-owned subsidiary of Pfizer Inc and consequent to this merger, Wyeth Ltd became a subsidiary of Pfizer Inc in India. However, since this was a merger transaction and not specifically an acquisition, it did not trigger a mandatory open offer as per takeover regulations in India.
Pfizer focuses on the sales of medicines related to cancer, heart attack and neurological illnesses, whereas Wyeth specialises in vaccines, antibiotics and gynaecological drugs.
(Edited by Joby Puthuparampil Johnson)