Don’t miss the latest developments in business and finance.

Ranbaxy set for $400mn FCCB

Image
Our Corporate Bureau New Delhi
Last Updated : Feb 25 2013 | 11:50 PM IST
Issue part of war chest for European buys.
 
Ranbaxy Laboratories Ltd is set to announce a $400-million foreign currency convertible bonds (FCCBs) issue as it braces up for a couple of acquisitions in Europe.
 
Besides the much-touted Betapharm Arzeniemittel GmbH bid in Germany, the Indian pharmaceuticals major is close to acquiring Romanian firms, Terapia and Sindan.
 
Ranbaxy executives declined to comment but a pharmaceuticals industry source close to the development said, "The top executives of the company have been virtually shuttling between Romania and Germany."
 
The $400 million worth of FCCBs are expected to be part of the war chest Ranbaxy will need for the Romanian targets and for Betapharm if it wins the bid. Ranbaxy is believed to have offered the owners of Betapharm, 3i Group, as much as ¤500 million, 50 million more than Dr Reddy's bid at ¤450 million.
 
Deutsche Bank and Citibank have been appointed to take care of the FCCB issue. "There is a lot of buzz around the issue but it is company policy not to comment on speculation," said a Ranbaxy spokesperson.
 
"Even though the bids have not been opened and the winner is not known, Ranbaxy is issuing this FCCB as money cannot be raised at the press of a button. With three possible acquisitions in the offing (one in Germany and two in Romania), the company seems confident that at least one to two deals will pass muster," explained a financial analyst.
 
Late last year, Ranbaxy received a board approval for raising as much as $1.5 billion which the company had kept aside "as an enabling provision". The intent was to raise the money as and when opportunities arose.
 
For long, acquisitions have been on Ranbaxy's radar and the efforts to grow inorganically seem to have intensified with Malvinder Singh taking over as the chief executive officer and managing director of the company. Singh, in the past, expressed the intention to make Ranbaxy grow inorganically and have the company among the top five generic players worldwide.
 
The bids for Betapharm are expected to be opened in a week's time. Apart from Ranbaxy, Dr Reddy's, Wockhardt and Nicholas Piramal were also in the fray for Betapharm.
 
While Wockhardt and Nicholas Piramal have fallen by the way side, Dr Reddy's and Ranbaxy are said to be in the last round of bidding.

 

Also Read

First Published: Feb 13 2006 | 12:00 AM IST

Next Story