Cipla buys Yemen-based drug distributor for $21 mn

Cipla will acquire a 51% stake in the company

Cipla, once known as a domestic pharmaceutical company, on Monday announced its fifth global acquisition deal within a span of a year, a 51 per cent stake in a pharmaceuticals manufacturing and distribution business in Yemen for $21 million.

While Cipla did not name the company, it said the Yemeni drug maker is owned by a business group based in the United Arab Emirates. Yemen is a fast-growing market where Cipla already has a leading position, with about 200 products. The deal includes more to be paid over the next three years, on achievement of agreed milestones.

This is Cipla’s second buyout this month. On June 17, it said it had acquired a 60 per cent stake in a Sri Lankan company for $14 million. Cipla had entered this transaction through its wholly-owned subsidiary, Cipla (Mauritius) Ltd. Through the recent acquisitions, Cipla seems to be eyeing a strong foothold in West Asia and Africa. On Monday, Cipla’s shares closed at Rs 437.95 apiece, up 0.15 per cent on the BSE. The company did not respond to queries from Business Standard.

Since 2013, Cipla has made five acquisitions in various countries. After completing the buyout of Cipla Medpro for $512 million in June 2013, it acquired a 14.5 per cent stake in Uganda-based Quality Chemical Industries, 100 per cent in Croatia-based Celeris in December 2013 and 60 per cent in the Sri Lankan company mentioned above.