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Piramal buys out Boots in JV

C H Unnikrishnan  |  Mumbai 

To lose Strepsils and Clearasil to Reckitt Benckiser.
has acquired The Boots Company Plc's 51 per cent stake in Boots Piramal Healthcare, making it a 100 per cent subsidiary.
The acquisition follows Reckitt Benckiser's global acquisition of Alliance Boots' OTC (over-the-counter) business. is a subsidiary of Alliance Boots.
Instead of paying The Boots Company for its stake, Nicholas Piramal will get a payment of Rs 17.8 crore from its erstwhile partner.
Sources close to the deal said this was because Nicholas Piramal has taken over the company as a going concern with all its liabilities and Reckitt Benckiser has decided to take the Boots Company brands, including Strepsils and Clearasil, out of the joint venture.
"Also, the joint venture is being terminated in two years instead of the ten year agreement. In sum, Nicholas Piramal will get Rs 17.8 crore from the transaction," a source said, while declining to disclose the valuation of the joint venture company. The company had reported a turnover of Rs 65 crore in the year ended March 2006.
Nicholas Piramal, India's fourth largest pharmaceutical company, will now reposition the subsidiary, which will have a new name, consolidating its existing product line along with all the non-prescription drugs of the parent company.
Apart from Strepsils and Clearasil, the other leading brands in the company's portfolio includes Saridon, Lacto Calamine and Polycrol.
"The over-the-counter business is central to Nicholas Piramal's strategy and we will continue to invest heavily in it. We will also launch over-the-counter brands in new therapy areas," Nicholas Piramal Chairman Ajay Piramal had said last week.
The company also the envisages transition of some of its generic brands to over-the-counter in due course.
Although Reckitt's buyout of Boots' over-the-counter business took place after the global merger of the British pharmacy groups, Boots Group Plc and Alliance Unichem Plc, it did not have any impact on the Indian joint venture.

First Published: Mon, October 02 2006. 00:00 IST