Fosun's revised Gland takeover plan no longer needs Indian approval

By Gareth Macdonald contact

- Last updated on GMT

iStock/danielvfung
iStock/danielvfung

Related tags: Pharmaceutical drug, Pharmacology

Shanghai Fosun Pharma says it no longer requires the Indian Government's permission to buy a majority stake in Gland Pharma.

In an emailed statement Fosun told us it will buy 74% stake in Gland for $ 1.1bn (€912.6bn) and set a termination date for the deal of October 3.

The Hong Kong Stock Exchange listed firm said: “The stake of Gland Pharma held by KKR Floorline Investment Pte. Ltd. and the Founder Shareholders that will be acquired by Fosun Pharma is adjusted from 69.971% to 57.891%​.”

After the transaction is completed, KKR will no longer own shares in Gland Pharma​.”

Government approval

Fosun announced its intention to buy Gland from founders and US investment group KKR in July​ last year, originally stateing that it would acquire an 86% stake in the Indian firm.

In August​ this year Fosun said India’s Foreign Investment Promotion Board (FIPB) had referred the takeover plan to the Government’s Cabinet Committee on Economic Affairs for review.

At the time a Fosun spokeswoman told us “The acquisition obtained prior approval from relevant PRC [People’s Republic of China] authorities, and is pending review and approval from the Cabinet Committee on Economic Affairs of India.”

Under rules​ introduced this year, any foreign investor that wants to buy an Indian drug manufacturer needs to seek Government approval if it plans to buy more that 74% of the target company's shares.

API supply

Gland makes injectable drugs, both own-brand medicines and for other firms on a contractual basis. It operates four facilities in India that produce active pharmaceutical ingredients (API) and finished dosage formulations.

The firm is a major supplier of the API heparin to hospitals in India.

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