Intas low-balls Mallinckrodt unit bid to $1bn on legal fears

MUMBAI: India's most valued privately-held drugmaker Intas Pharmaceuticals is offering just under $1 billion to acquire UK-based Mallinckrodt's US generics business, below the asking price of at least $1.2 billion, people directly aware of the matter said.

Ahmedabad-based Intas, controlled by the Chudgar family, lowered the final valuation on fears of future lawsuits involving Mallinckrodt's opiate-based painkillers, which is facing a crackdown for its addictive potential, they added.

Temasek and ChrysCapital-backed Intas is said to be the only serious bidder left in the fray. If there's no agreement on valuation, Mallinckrodt could pull back the deal and explore other options. "The offer price is in the range of $950 million to $1 billion. Both Intas and Mallinckrodt are sticking to their respective positions, slowing down the negotiations right now," one of the sources mentioned earlier said.


Another source said Intas was still pursuing the deal though it was unlikely to raise the valuation. Despite legal worries, opioid or medicinal-controlled substances remain an attractive therapeutic segment with less competition and higher profit margins.

Last year, media reports mentioned that Intas had emerged as a strong contender to acquire Mallinckrodt unit in a deal estimated between $1.5-2 billion. The other bidders included India's Aurobindo Pharma and consortium of private equity investors.

When contacted, Intas Pharma said it would not comment on speculation, while Mallinckrodt could not be reached for comments immediately.