A day after pharmaceutical major Wockhardt announced its decision to sell its nutrition business to French food multinational Danone, the company approached the Bombay High Court for legal clearance to go ahead with the deal. The court will hear the matter on September 6.
Wockhardt is yet to settle the legal disputes with some of its lenders, which had earlier opposed and thwarted a similar sale deal the company had announced with US pharmaceutical multinational Abbott. The Wockhardt-Abbott deal involving the sale of the same business division was called off later as the company failed to resolve differences with its lenders.
Wockhardt’s problems with its lenders began after it failed to redeem its foreign currency convertible bonds (FCCBs) due to a financial crisis. The buyback package offered by the company was not acceptable to the investors. The bond holders had argued that Wockhardt would have to reach an agreement to settle their dues before it went ahead with such deals.
The Bombay High Court fixed the hearing date as September 6 after some of these lenders sought more time to study the Wockhardt-Danone deal.
Wockhardt, which had to pay an outstanding of $110 million FCCBs at the initial stage of its crisis, has worked out settlements with a majority of its lenders. The unsettled bonds are worth approximately $60 million, it is learnt.
A clutch of investors, represented by Singapore-based hedge fund QVT, and Sun Pharma (Wockhardt’s local competitor in the drug business) are yet to resolve their issues with the company.
