Ranbaxy eyes more acquisitions

Company denies hiving off R&D unit.

Ranbaxy Laboratories has more acquisitions on the cards to expand its overseas presence and technology enhancement.

Talking to reporters today in Mumbai, Ranabxy managaing director Malvinder Singh said the company is scouting for acquisition opportunities in India, the US and Europe. "This is not the end. There is more to come," he said.

The company, which recently acquired a company in Romania, has plans for domestic buyouts as well to strengthen its manufacturing and technology capabilities for the overseas generics market.

However, Singh denied the recent reports in the media about a possible spin off of its R&D arm into a separate company.

"The company has no plans to hive off its research and development business. The R&D is critical to Ranbaxy and it will continue to be the key driver," Malvinder said.

"We will continue to look out for alliances for our new chemical entities within R&D," he added. Analysts said the company had recently raised a war chest of $1.5 billion for overseas acquisitions.

The Romanian acquisition of the Ranbaxy""Terapia for $324 million, is expected to reap huge returns for the company, the analysts said.

The Terpia's business is expected to contribute over $100 million to Ranbaxy's turnover in 2006, making it the third largest market for the group, displacing France.

Currently, US is the largest market for the company, followed by India. In 2005, Ranabaxy's US sales were $332 million, while in India it recorded $238 million. France posted $73 million sales last year.

"The Romanian market will serve as a hub for the company's European operations. Its operations will be integrated with Ranbaxy's subsidiary in Romania and the closing will be done by the second quarter this year," Singh said.

Once it is combined, it will create the number one generics company in the Romanian market and will additionally boost Ranbaxy's presence in CIS markets, he added.

Ranbaxy shares closed at Rs 419.30 on National Stock Exchange today, down 3.3 per cent from Wednesday.