Dishman set to acquire UK firm

Decision on acquisition to be taken at board meeting today

Ahmedabad-based Dishman Pharmaceuticals and Chemicals (DPCL), a leading contract manufacturing firm, has identified a UK-based company for acquisition.

The final decision on the deal is expected to be taken in the company's board meeting on Friday. The cost of the acquisition is estimated to be around Rs 35 crore.

Dishman will in all probability use the UK based company for carrying out its contract research activity.

"We are planning to acquire an UK based company for contract research. However, a final decision on the acquisition will be taken at the board meeting on Friday," J R Vyas, managing director, Dishman Pharmaceuticals and Chemicals said.

He did not reveal the name of the UK-based company.

This acquisition is expected to boost the company's specialisation in contract research and manufacturing.

This would be Dishman's second overseas acquisition. It recently acquired a Holland-based company for manufacturing phosthanium quats. Quats have applications in pharma, dyes intermediates, paints and polymers. With this acquisition, Dishman has attained leadership position in the quats segment in the European markets.

Dishman is the only focussed player in this segment in India and is among the top three players in the world. It is the only global company having the complete range of quats.

"Custom synthesis, contract research and contract manufacturing are the three significant areas that constitute the cream of outsourcing business. We are creating world class research and development (R&D) centre at our existing 100 per cent export oriented unit (EOU) at Bavla, on the outskirts of Ahmedabad, which is expected to go on stream by end of this month," said Vyas.

The company's business segments may be classified in two broad categories "" marketable molecules (MMO), which focuses on quats production and specialty chemicals, besides manufacture of niche active pharmaceuticals ingredients (API), and phase transfer catalysts (PTC) for over thousands customers worldwide.

Through a network of wholly owned subsidiaries, DPCL has strong presence in Europe, United States, Netherlands, Cyprus, South Africa, UAE, and China, besides having an unit in Africa. Over two-third of the company's sales comes from the export market, the rest caters to domestic market.

Dishman has bagged over a dozen new contract research assignments from top-end pharma multi-national corporations (MNCs), which is expected to generate revenues of around 50,000 euro per contract.

The company reported a spurt in its net profit for the quarter ending December 31, 2004. Its total income for the third quarter ending December 31, 2004 stood at Rs 44.25 crore as compared to Rs 33.42 crore for the corresponding period in the previous year.