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Biocon plans M&As to boost bio-pharma biz

INDIA INC ON BUYING SPREE

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BS Reporter Bangalore
Last Updated : Feb 05 2013 | 1:36 AM IST
Bangalore-based biotech major Biocon, which is expecting to get $97 million upfront through the sale of its enzymes business to Denmark-based Novozymes, is looking at acquisitions to strengthen its bio-pharma business.
 
"We are looking at investing in bio-pharma companies or making acquisitions to strengthen our business with the sale proceeds," said Kiran Mazumdar-Shaw, chairman and managing director of the company. Shaw, however, did not identify the target companies. Biocon divested its enzymes business by selling it to Denmark-based Novozymes for $115 million.
 
The agreement was signed today and the company would now seek shareholders' approval through postal ballot.
 
Novozymes is expected to utilise Biocon's production and formulation facilities under lease and service agreements.
 
Both the companies expect the agreement to be approved by appropriate authorities and the transaction is expected to be closed before the end of third quarter this year.
 
After completing this divestment, Biocon will focus on its bio-pharma business verticals that include APIs, biologicals and proprietary molecules, both commercialised and under development.
 
"Over the past decade, we have recognised the high growth trajectory of bio-pharma business verticals and progressively invested in building proprietary know-how and global scale. We believe this is the right time to divest our enzymes business and focus on unleashing the full potential of our bio-pharma businesses," Shaw said.
 
"Novozymes as the recognised world leader in enzymes will be in a strong position to leverage our existing enzymes portfolio that we have built over a span of nearly three decades," she added.
 
Commenting on the deal, Steen Riisgaard, CEO of Novozymes said, "The acquisition of Biocon's enzymes business provides an important step for us in strengthening our position in the Indian market. The activities of Biocon have an excellent strategic fit with our existing enzymes business."
 
Biocon's enzymes business will be integrated into Novozymes South Asia, a fully-owned affiliate of Novozymes A/S. Production and formulation will continue at the Biocon site under lease and service agreements with Novozymes.
 
In the quarter ended June 30, Biocon's revenues from the enzymes business dropped 3 per cent compared with the corresponding quarter in the previous financial year.

 

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First Published: Jul 19 2007 | 12:00 AM IST

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