Thursday, January 14, 2016

Cadila gets nod for Rs 5,000-cr QIP

Foreign Investment Promotion Board (FIPB) has approved a total investment proposal of Rs 6,050 crore, with the largest chunk coming from Cadila Healthcare and Nitin Lifesciences.

Ahmedabad-based drug maker Cadila Healthcare has secured nod to raise upto Rs 5,000 crore of fresh equity from foreign investors through qualified institutional placement (QIP) route.

The company proposes to use the funds for business expansion and acquisitions.

FIPB has also granted approval to Swedish firm Recipharm's acquisition of 74 per cent stake in injectable maker Nitin Lifesciences for Rs 672 crore.

Recipharm has totally secured approval to invest Rs 1050 crore in a wholly owned subsidiary in India. The investment in Nitin Lifesciences will be carried out through the subsidiary.

Cadila Healthcare did not respond to an email query on the topic.

Last April, Cadila had secured share holder approval for an enabling resolution to raise upto Rs 10,000 crore through debt or equity instruments such as bonds, debentures or share sale through QIP route. At that time, the company said it was looking at growth through both organic and inorganic manner and hence was seeking approval to raise resources.

Recently, Cadila acquired select brands and the Haridwar manufacturing unit of Zoetis, which was spun off Pfizer in 2013, for an undisclosed sum.

The acquisition will help the company expand its animal health business in India and gain access to manufacturing operations which have also been catering to global markets.

As a result of the acquisition, it would gain access to a wide range of nutrition as well as therapeutic products which have strong brand equity and a combined turnover of Rs 171 crore.

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