Mitsui & Co buys an additional 25 per cent stake in Arch Pharmalabs
The deal with the Japanese company would increase the holding of foreign investors to 46 per cent in the Indian pharma major.
New Delhi, September 17, 2012: Japan’s diversified trading company, Mitsui & Co has decided to purchase an additional 25 per cent stake in Arch Pharmalabs for Rs 372 crore. This move will raise the shareholding of the Japanese company in the Mumbai-based privately held pharma major to 30 per cent.
It is worth noting here that Mitsui is buying out the stakes of IL&FS Trust Co, IDBI Trusteeship Services and Rainbow Fund, according to an application to the FIPB.
The deal will increase the holding of the foreign investors in the Indian company to 46 per cent. As per Arch Pharmalabs, the stake sale will make way for the exit of three private financial investors.
The pharmaceutical ingredient manufacturer decided to sell this stake to the Japanese company primarily because it was neither a non-financial nor non pharma investor and avoided a possible conflict with its existing set of customers.
It may be noted here that Arch Pharmalabs also provides contract research and manufacturing services (CRAMS) to other pharma companies for a fee apart from making active pharmaceutical ingredients and intermediates, the main chemical used in making medicines.
As per the deal, the Japanese company would represent Arch Pharmalabs exclusively in Japan for both its generic and CRAMS business.