French healthcare company Merieux Alliance, which holds a 78.85 per cent stake in Hyderabad-based vaccine manufacturer and biopharmaceutical firm Shantha Biotechnics, might dilute some of its stake, according to Shantha founder and managing director KI Vara Prasad Reddy.
The company has, however, assured to remain a majority stakeholder and hold at least 51 per cent to ensure that the new partner did not bring a drastic change in the line of operations, said Reddy. The dilution of stake is to bring in new technology, new products or enter new markets or a combination of these. Reddy holds a 14.1 per cent stake in Shantha.
The French company picked up a majority stake (60 per cent) in Shantha Biotechnics in November 2006 from Oman-based financial firms to strengthen its India presence.
On reports that Shantha was a target for an acquisition, he said the company was attractive with proven capabilities in vaccine development and market penetration and, therefore, many companies including one from Hyderabad were eyeing to acquire it. "I declined to sell my stake in the company so some of them are approaching Merieux for dilution of its stake,'' Reddy said, adding the company, which is not seeing any drastic upward or downward surges, had been getting acquisition proposals from various companies since the late 90s.
“Merieux is still taking my opinion on company issues. But I do not know for how long they would do so,” he said.
Interacting with the media here on Friday on the sidelines of announcing the launch of Shanchol, an oral cholera vaccine, he said the company would continue to work on low-cost vaccines. Shanchol would be priced at about Rs 300 per dose of 1.5 ml and two doses were needed to give protection against cholera for about four years. The commercial launch would be in June or July.
The company has invested about Rs 5 crore over three years in developing Shanchol in collaboration with the International Vaccine Institute, Seoul. It received funding from the Bill and Melinda Gates Foundation for the project.
Currently, the Hyderabad facility has a capacity to manufacture 5 million doses, which would be ramped up to 25 million doses in about six months.