GLL, TSAC in reverse merger

Glenmark Laboratories Ltd GLL on Thursday said the company has entered an amalgamation agreement with Pune-based TSAC Pharmaceuticals Ltd ...

Glenmark Laboratories Ltd GLL on Thursday said the company has entered an amalgamation agreement with Pune-based TSAC Pharmaceuticals Ltd TPL. The swap ratio for the merger will be 1.8:1, ie. GLL shareholders will get 1.8 shares of TPL for every one share held in GLL.

The amalgamation will lead to a creation of a Rs 1,200 crore entity which will be a player in both the pharmaceuticals and bio-pharmaceuticals sectors and in the manufacture of formulations as well as basic substance, Glenmark Labs8217; Managing Director Mark Saldhana said here.

TPL, a Bombay Stock Exchange-listed company, is an integrated active pharmaceutical enterprise, while GLL is the formulaion company.

Post-amalgamation, TPL would issue 2.2 crore equity shares to GLL shareholders for the alignment, Saldhana said.

8220;The combined entity, which will be named shortly, will have a combined turnover of Rs 590 crore in the fiscal 2006, and with stengths in various sectors emerge as a top player in the Indian pharma industry,8221; he said.

The new entity will be export-oriented and would target niche therapeutic segments, biopharmaceuticals, drug discovery and development support services and custom reserach and manufacturing services, he said. Both the companies will approach the courts for completing the merger formalities, Saldhana said.

He added that the name of the new entity has still not been decided.

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8220;We plan to come up with a name soon,8221; he added.

8220;Companies that are fully vertically integrated will be better positioned in the post-patent scenario. Our pact with TASC will help us to backward integrate in terms of our API requirement for our current and future range of formulations,8221; Saldhana said while explaining the need for such an amalgamation.

On future plans of the new entity, he said it would leverage Glenmark8217;s tie-ups with companies in th UK, Australia, Brazil and South East Asia to supply TASC8217;s current and future range of API to these markets.

Saldhana said R038;D skills will be used by the amalgamated entity to emerge as a major player in contract research and manufacturing releated services.