Tepid kind of end to Ranbaxy-Orchid saga
2008-04-23 17:32:43 Source : moneycontrol.com
CNBC-TV18's research analyst, Varinder Bansal - A tepid kind of end to Ranbaxy-Orchid saga. Finally, both the cos have agreed to settle at strategic business alliance where they will leverage on respective strengths of both the co for mutually beneficial business growth. Important to understand is that Ranbaxy stake will stand at 14.7% in Orchid Chem and there will be no open offer. Commenting on the same Orchid Chem mgt said that no stake sale discussion with Ranbaxy has been initiated. In the strategic business alliance; Orchid is likely to manufacture prodcuct which will be marketed by Ranbaxy due to geographical presence and no separate company will be formed for alliance. The agreement will establish a framework for enhanced future co-operation between the two companies. Experts believe that alliance will help Ranbaxy to have product basket in the antibiotic & injection space as the price erosion does not come belwo 40% and profit margins are around 25-30
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