The union cabinet on Thursday approved $750 million (Rs.4,944 crore) investment by Dutch drug major Mylan Group B.V. Netherlands into its Indian subsidiary Mylan Laboratories Ltd.
"The union cabinet, chaired by Prime Minister Narendra Modi, has approved $750-million FDI in Mylan Laboratories Ltd by Mylan Group through equity shares or convertible debentures for acquiring entire shareholding of Jai Pharma Ltd (JPL)," an official statement said here.
The Mumbai-based JPL is being demerged from its then shareholders, including Orizaba and resident Indian investors.
"The approval will be subject to the production level of consumables and NLEM (national list of essential medicines) drugs and their supply to the domestic market will be maintained at a quantitative level over the next five years," said the statement.
The second leg of transaction involves infusion of fresh foreign funds by Mylan group to acquire JPL shares.
The 54-year-old Mylan group, whose Indian subsidiary is based in Bengaluru, is one of the largest generics and specialty pharmaceutical firms in the world, producing over 1,400 drugs for retail, wholesale, government and institutional customers.