Government clears KKR's proposal for investment in GLAND
The PE firm plans to invest in Gland Pharma and Gland Celsus Bio Chemicals.
New Delhi, May 15, 2014: The Government of India has cleared the proposal from the private equity firm KKR's proposal to acquire stakes in two drug firms - Gland Pharma and Gland Celsus Bio Chemicals. The investments are expected to be worth around Rs 1,400 crore as KKR plans to pick up 37.9 per cent stake in Gland Pharma for US$ 191 million and 24.9 per cent stake in Gland Celsus Bio Chemicals for US$ 39.8 million.
The deal has already been approved by the Competition Commission of India and Foreign Investment Promotion Board (FIPB) earlier this year.
It may be noted here that the final proposal which got cabinet clearance doesn't include non-compete clauses, which is in line with the new norms under the pharma FDI policy in brownfield ventures. In other words, the promoters of Gland Pharma are not bound by the share purchase agreement from again establishing similar business.
It is worth noting here that Gland Pharma makes and markets specialised injectable formulations for generic versions of drugs, it also manufactures a limited quantity of APIs (Active Pharmaceutical Ingredients) for in-house consumption.