Sun Pharma gets US FTC nod to buy Ranbaxy

The US Federal Trade Commission (FTC) has approved the proposed $4-billion buyout of Ranbaxy Laboratories by Sun Pharmaceutical, the companies said on Monday.

The US FTC completed its review of the deal and has granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, according to a joint statement. The early termination of the waiting period under the HSR Act satisfies one of the essential conditions to the closing of the Ranbaxy acquisition.

Meanwhile, FTC has accepted a proposed consent agreement following which Sun Pharma and Ranbaxy Laboratories have agreed to divest Ranbaxy’s interests in generic minocycline tablets and capsules to an external third party, the statement added.

Generic minocycline tablets are used to treat a wide array of bacterial infections, including pneumonia, acne and urinary tract infections.

In December, the Indian fair trade regulator Competition Commission of India (CCI) had approved the mega deal with certain riders. As per the conditions, CCI directed both the companies to divest seven products as it found that the deal could hit competition in the Indian market.

While it asked Sun Pharma to divest all products containing ‘Tamsulosin + Tolterodine’ which are, at present, marketed and supplied under brand name Tamlet, Ranbaxy was directed to sell all products containing Leuprorelin which are marketed and supplied under brand name Eligard.

Last April, Sun Pharma announced that it would take control on Ranbaxy in an all-stock transaction with a total equity value of $3.2 billion, along with debt of $800 million, taking the overall deal value to $4 billion.

This would be the biggest domestic M&A deal ever and by far the top pharma deal in local currency terms. The deal, once completed, would create India’s largest and world’s fifth biggest drug maker with operations across 65 countries, 47 manufacturing facilities in five continents and a global portfolio of specialty and generic products.

Shares of Sun Pharma shares were trading at Rs 934.80, up 2.06 per cent, while those of Ranbaxy were up 2.71 per cent at Rs 722.75 each at 11:57 AM on Monday in a weak Mumbai market.

(Edited by Joby Puthuparampil Johnson)

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