Zydus plans Spanish buy for Rs 200 cr

Acquisition likely to be funded from the internal accruals.

Cadila Healthcare (Zydus) is close to acquiring a Spanish pharma company as part of its expansion plans in Europe. The size of the deal, to be announced shortly, can be in the range of Rs 150 crore to Rs 200 crore.

Sources close to the development said the Rs 1,063-crore Zydus was at an advanced stage of negotiations with a Spanish generic drugs firm. The acquisition is expected to be funded by the internal accruals of Zydus.

When contacted, Zydus sources said the company had been in talks with a few Spanish firms. "The company is interested in having a strong base in Europe to tap opportunities for growth in the generic market, especially in France, Germany, the UK, Italy and Spain over the next decade," they added.

Sources said the acquisition would help Zydus to explore the untapped generic market in Spain and the neighbouring markets by using front-end capabilities of the Spanish company.

The generic drugs market in Europe is the second largest in the world, after the US, and is valued at $6.5 billion. Zydus has gained its presence in Europe with the acquisition of Alpharma France SAS, the French affiliate of one of the world's largest generic companies, for ¤5.5 million, last year.

The French company, renamed as Zydus France SAS, focusses on the core therapy areas of antibiotics, cardiovasculars, anti-hypertensives, central nervous system, anti-diabetics. Zydus has the advantags of having more than 90 generic registrations and a ready distribution network to introduce a large number of products in Europe.

Meanwhile, Zydus is also embarking on a marketing enhancement programme in India to gain leadership in gastro, cardiac and anti-biotic segments. The company has engaged Interlink, a premier consultancy firm, to assist its business performance and growth.

A joint team of Interlink consultants and the Zydus management has recently been constituted to monitor transformation of marketing, strategy, planning and execution over the next 18 months.