Shreya buys into drug firm in Singapore

Agrees to acquire 24% stake in SciGen in a 3-phase deal.

The Rs 2,300-crore Shreya group is picking up a 24 per cent stake in SciGen Ltd, a Singapore-based pharmaceuticals major.

"We are making a strategic investment. Initially, we will pick up a 5 per cent stake in SciGen, and scale it up to 24 per cent by January 2005. The investment will be in the range of Australian $8.2-$ 10.14 million," Shreya group Chairman Sujit Kumar Singh said.

Shreya will pay 7 Australian cents for every SciGen share, against the market price of 1 cent per share.

The entire process will be completed in three phases. Initially, Shreya will purchase 22 million SciGen shares, representing 5 per cent of its currently issued capital.

It will then subscribe to a one-for-four, non-renounceable rights issue. Finally, SciGen will place additional shares with Shreya to help the latter take its holdings to 24 per cent of the expanded capital base.

Also, Singh and Shreya's Director Ajit Bhaskar will join the SciGen board.

"SciGen has a strong presence in the Asia-Pacific region, besides being a significant player in the bio-pharmaceuticals space, with marketing and technological expertise and product registrations," a company executive said.

Shreya and SciGen already have a 'commercialisation agreement' in place for bringing SciGen's products to India. Shreya is building a new $20 million facility at Pune, where SciGen's products will be manufactured.

Singh's Shreya group comprises Shreya Corporation Moscow, Shreya LifeSciences India Ltd and Shreya Biotech Pvt Ltd. The group started its operations in India by acquiring the pharmaceuticals business of Rallis India.