Ranbaxy likely to divest stake in Eli Lilly venture

There is going to be unlocking of valuations and in case Ranbaxy decides to get out of the joint venture, it will help the company generate funds to be utilised for its various expansion programmes, Raizada said. However, he clarified that such a decision would not affect Ranbaxy’s other joint ventures with Eli Lilly in the US, Australia and other Asian countries.

The company’s board will be meeting on January 5, 2001 to take up the proposal of either getting out or staying in the joint venture with Eli Lilly in India.In a notice to the Bomaby Stock Exchange, the company has said that it is considering to divest its stake in the joint venture.

The board would also consider and approve purchase of equity shares of Gufic Pharma Ltd, a non-listed company, from the promoters.

Raizada clarified that Gufic Pharma is a shell company and buying it out by Ranbaxy is only a legal formality as the company had acquired a few brands from Gufic in 1997, which belonged to Gufic Pharma. He said that no money will be transacted in the purchase of this company.

Ranbaxy entered into a global alliance agreement with Eli Lilly for marketing of pharmaceutical products in the US and other countries. For the purpose of Indian joint venture, a company under the name Ranbaxy Lilly company was incorporated.