Dilip Shanghvi buys 3.5% in Natco Pharma

Sun Pharma's chief Dilip S Shanghvi has bought 1 million shares or about 3.5% stake in the drugmaker's smaller rival Natco Pharma for an estimated Rs 25 crore.

While officials of both the companies did not comment on the transaction, the data available with the National Stock Exchange showed that Shanghvi, chairman of Sun Pharmaceuticals, purchased 1 million shares of Natco Pharma between December 5 and December 7 in two separate block deals.

These shares account for an estimated 3.5% stake in Natco Pharma, where the promoters hold little over 63% stake. Institutional investors hold about 15% stake in the company, while other public shareholders have about 22% holding.

As per the NSE data, Shanghvi picked up 7,25,000 shares yesterday held by Orange Mauritius Investments at price of Rs 253 a piece, aggregating the deal value to Rs 18.34 crore through bulk deal.

In a separate deal, Shanghvi bought 2,75,000 shares held by Pasha Finance Pvt Ltd for Rs 233.60 each, translating into a transaction size to Rs 6.42 crore, on December 5.

Shares of Natco Pharma closed at Rs 258.55 on the BSE, down 7.20% from its previous close. Over the previous two trading sessions, the share price of Natco Pharma had surged by about 15%.

Separately, Natco Pharma today said in a statement that it has completed a Qualified Institutional Placement (QIP) of its shares to raise Rs 67.5 crore of funds to part finance its expansion plans.

The QIP issue of 3 million share of Rs 10 each at an issue price of Rs 225 a piece, opened on December 7 and closed the same day. The company said it is in the process of allocating the shares issued under its QIP issue.

The QIP route is used by listed companies to raise capital through sale of shares to institutional investors.