NEW DELHI: India’s third-biggest drugs company Sun Pharma announced yesterday a $3.2bn deal to buy larger domestic rival Ranbaxy from Daiichi Sankyo, ending the Japanese company’s costly run as owner.
Despite Ranbaxy’s huge US safety regulatory problems, Sun Pharmaceutical Industries said the transaction offered “tremendous growth opportunities” thanks to Ranbaxy’s “significant presence” in the US market as well as in India and other high-growth emerging markets.
“Sun Pharma and Ranbaxy will have a diverse, highly complementary portfolio of specialty and generic products,” Sun Pharma managing director Dilip Shanghvi, who founded the company in 1983, said. But the immediate winner from the deal, analysts said, was Daiichi which extricates itself from its troubled ownership of Ranbaxy while striking a strategic partnership with Sun Pharma.
Daiichi Sankyo’s shares were up 3.3 percent at 1,813 yen in yesterda’s trade.
Daiichi bought Ranbaxy in 2008 for $4.6bn, believing its dominance in cheap generic medicines would boost the Japanese firm’s revenues.
But the Indian company created a huge drain on Daiichi’s finances after US regulators slapped import bans on Ranbaxy drugs over quality concerns, and a year after its purchase, the Japanese company announced a $3.84bn loss on the deal.AFP