Arch Pharmalabs acquires 42 pc of Avon Organics
Mumbai-based Arch Pharmalabs on Sunday said it is acquiring 42 per cent stake in BSE-listed Avon Organics for Rs 20 crore.
MUMBAI: Mumbai-based Arch Pharmalabs on Sunday said it is acquiring 42 per cent stake in BSE-listed Avon Organics for Rs 20 crore.
Arch Pharmalabs would go for another 20 per cent more stake through an open offer to the public shareholders of Hyderabad-based Avon Organics.
Avon Organics would allot equity shares on a preferential basis to Arch at a price of Rs 20 per share.
"The acquisition of Avon would give us access to a plant with USFDA approval, which we don't have now," Arch Pharmalabs Chairman and Managing Director Ajit Kamath said.
"The USFDA status will help Arch to fast forward a few product launches in the US," he said.
Avon would be a standalone listed-subsidiary of Arch. It has two manufacturing facilities.
With Avon in its bag, Arch would get access to Diketene Chemistry, an intermediate, which is not made by any other Indian company.
"Diketene Chemistry is imported from China. And as the prices of Diketene Chemistry from China has fallen, it has affected Avon, which has began to report losses," Kamath said.
Avon last year reported a loss of Rs 15 crore against a turnover of Rs 80 crore. For the half-yearly ended September, it reported a loss of Rs 7 crore, Kamath said.
Arch Pharmalabs would go for another 20 per cent more stake through an open offer to the public shareholders of Hyderabad-based Avon Organics.
Avon Organics would allot equity shares on a preferential basis to Arch at a price of Rs 20 per share.
"The acquisition of Avon would give us access to a plant with USFDA approval, which we don't have now," Arch Pharmalabs Chairman and Managing Director Ajit Kamath said.
"The USFDA status will help Arch to fast forward a few product launches in the US," he said.
Avon would be a standalone listed-subsidiary of Arch. It has two manufacturing facilities.
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With Avon in its bag, Arch would get access to Diketene Chemistry, an intermediate, which is not made by any other Indian company.
"Diketene Chemistry is imported from China. And as the prices of Diketene Chemistry from China has fallen, it has affected Avon, which has began to report losses," Kamath said.
Avon last year reported a loss of Rs 15 crore against a turnover of Rs 80 crore. For the half-yearly ended September, it reported a loss of Rs 7 crore, Kamath said.
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