Cadila to buy European firm at $80 mn

Gujarat-based Cadila Pharmaceuticals is close to buying an European company that specialises in neurology and opthalmology medicines. The deal, said to be valued at $80 milllion (about Rs 320 crore), will be announced soon.

A Cadila executive said that the acquisition would enhance the company's marketing capabilities in Europe. This will be Cadila's second overseas facility. Last month, the company had invested $15 million (about Rs 60 crore) to set up a joint venture facility in Ethiopia.

As a part of its agressive growth plans, Cadila will develop a state-of-the-art medicine production facility at its pharma special economic zone (SEZ) coming up near Ahmedabad.

The company will develop 21 drug production facilities at the SEZ and these will be given out on lease. It has appointed global consultancy Deloitte to assist in marketing the project.

Cadila is in talks with domestic and foreign collaborators for JVs in infrastructure projects worth Rs 400 crore at the SEZ, said Vembu Subramanyam, vice-president (finance).

Of the 21 units, nine will manufacture drug raw materials that are commonly know as active pharmaceutical ingredients (APIs). Nine other units will produce finished medicines and the rest will house contract research organisations. "We are in negotiations with interested parties to lease out the facilities. Atleast 12 units will be ready by December 2008," Subramanyam said.

Deloitte Touche Tohmatsa India, the Indian arm of the consultancy company, recently completed a detailed project report on the SEZ. Deloitte is engaged in identifying potential takers for the facilities. Cadila has engaged an Italian firm to do the landscaping for the entire area.

Cadila is investing some of its resources in the SEZ and is also arranging funds from Bank of India, Bank of Baroda and Canara Bank.