No definite plan to sell formulations biz: Elder Pharma

Moneycontrol Bureau

Mumbai-based Elder Pharma says it has no definite proposal to sell its domestic formulations business, nor has it received any offers from any company for the same.

However, it has been looking at opportunities of organic, inorganic growth, strategic restructuring, fund raising etc, it said in a notice to stock exchanges.

Elder Pharma shares surged to its 5 percent upper circuit limit of Rs 309.50 on NSE on Wednesday, after Economic Times newspaper reported that global pharma majors like Sanofi Aventis, Novartis and GlaxoSmithKline were in the race to buy-out the debt ridden company's domestic formulations business.

While Sanofi and GSK have put in non-binding bids, Novartis has signed a non-disclosure agreement, the report said, adding that even a few private equity players planned to join the bidding process.

"At this stage the Company does not have any definite proposals for sale of its domestic formulations business...We have not received any non-binding offers from counter parties as mentioned in the article," Elder Pharma said.

Also Read: Chakan output to dip by 1,000 units/day on strike: Bajaj Auto

Elder Pharma has a debt of around Rs 1,300 crore. In FY13, the company reported a net profit of Rs 81 crore on revenue of Rs 1,457 crore. It paid Rs 107 crore in finance costs.

There had been an earlier report, which said that the debt-ridden company was up for sale. Alok Saxena, the company's MD had then said the report was just a "market rumour."

Elder Pharma shares finally closed at Rs 309.20 on NSE, up 4.9 percent.