|
| Cipla to offload 4% stake for Rs 840 crore |
| BS Reporter / Mumbai Sep 23, 2009, 00:39 IST |
|
Leading domestic drug maker Cipla will sell about four per cent of its equity to institutional investors to raise close to $175 million (Rs 840 crore) to fund its capital expansion plans.
Amar Lulla, joint managing director, confirmed the development and said the funds would be utlised for the ongoing expansions. “Due to regulatory issues, now I am not in a position to reveal more details,” he said. Sources said the company will close the transactions by tomorrow.
News agency Reuters said the company will sell shares to institutional investors at Rs 263.75 each, near today’s closing price. The base amount of the share sale is $110 million, with an option to raise it to $175 million. The deal is priced at a 0.06 percent discount to today’s closing price of Rs 263.90, said the report.
CLSA, JPMorgan and Kotak Mahindra Capital are the arrangers for the deal, said sources.
Cipla is setting up a new active pharmaceutical ingredient unit in Bangalore, besides modernising its units at Kurkumbh and Patalganga. It is also constructing a special economic zone (SEZ) for drug formulations at Indore, Madhya Pradesh, by spending Rs 750 crore.
The company requires an additional Rs 500-600 crore for the next two years, in addition to the usual annual working capital needs of Rs 300 crore, chairman and managing director Y K Hamied had said recently.
In July, the board of directors had approved a proposal to raise up to Rs 1,500 crore by further issue of securities in domestic and international markets through various financial instruments.
The promoter group led by Hamied holds 39.38 per cent of the company’s equity, according to Bombay Stock Exchange data for the quarter ending June 30. Life Insurance Corporation has 12.58 per cent and Camgest SA Magellan has 2.06 per cent in the company. The rest of the equity is with the public.
|
|
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
|
Content Guide
