final m&a 2003
DESCRIPTION
7ppts on M&A wth example of ranbaxyTRANSCRIPT
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Incentives for Mergers and Acquisitions by Indian companies
• Build critical mass in terms of marketing, manufacturing and research infrastructure
• Establish front end presence
• Diversification into new areas
• Enhance product, technology and intellectual property portfolio
• Catapulting market share
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About Ranbaxy
• Incorporated in 1961
• Came with IPO in 1973
• Global footprint in 49 countries
• World-class manufacturing facilities in 11 countries
• Serves customers in over 125 countries
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• Acquired 34.8% promoter stake of Ranbaxy at a price of Rs.737 per share
• Transaction value = US$ 4.6 billion (Rs.19780 crores.)
(Currency Exchange Rate 1US$ = Rs.43)• Financed through a mix of bank debt facilities and
existing cash resources of Daiichi Sankyo
About the deal
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About the deal
• Total no. of shares acquired : 220.6 million
• Through open offer : 92.5 million
• From the promoter : 81.9 million
• Through the preferential issue of equity shares and warrants 46.2 million
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Benefits to Daiichi Sankyo Ltd.
• Ranbaxy’s: low-cost manufacturing infrastructure and
supply chain strengths
• Elevate the Daiichi Sankyo’s position from 22 to 15 by market capitalization in the global pharmaceutical market.
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Benefits to Ranbaxy Ltd.
• Ranbaxy gains access to Daiichi Sankyo’s research and development expertise to advance its branded drugs business.
• The deal frees up its debt and imparts more flexibility into its growth plans.
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SYNERGY
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Long-term value for all stakeholders
• A complementary business combination
• An expanded global reach
• Strong growth potential
• Cost competitiveness
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REFERENCES
• Research report by Daiichi Sankyo Ltd.• Economic Times dated 12th June, 2008.• The Financial Express dated 21st Oct.,2008.