Japan’s Daiichi Sankyo is set to buy a majority stake in Ranbaxy Laboratories, India’s largest pharmaceutical company.
When it closes, the deal will be the single largest foreign direct investment in a publicly listed company in India. It is also one of the most structurally complex transactions in India’s history and will require regulatory approvals from several jurisdictions.
Daiichi Sankyo will acquire the entire shareholding of the promoters of Ranbaxy and further seek to acquire the majority of the voting capital of Ranbaxy at a price of Rs737 (US$17.13) per share. The total value of the transaction is expected to be around US$4.6 billion.
International law firm Jones Day is representing Daiichi Sankyo as the legal adviser outside India, while Anand Pathak and Nitin Wadhwa of Delhi-based P&A Law Offices are advising Daiichi on Indian law. A team from Vaish Associates, led by Bomi Daruwalla, is advising Ranbaxy and the Singh family.
The acquisition is expected to be completed in March 2009, but is subject to the approval of Ranbaxy’s shareholders and regulatory and statutory clearances. (See full coverage on page 30.)