Cipla to acquire 51% stake in Yemeni pharma firm

Cipla has stepped up its overseas acquisitions by inking a pact with a Yemeni firm to acquire its majority stake for $21 million (over Rs125 crore) as part of its efforts to emerge global supplier of cheap medicines.

The company said it has signed a definitive agreement to acquire a 51 per cent stake in a pharmaceuticals manufacturing and distribution business in Yemen.

"The company will pay $21 million for this transaction, with additional considerations to be paid over the next 3 years on achievement of agreed milestones," Cipla said in a filing with the Bombay Stock Exchange.

Overseas venture will act as a safeguard against the recent woes faced by Indian pharmaceutical companies and also serve the recent preference to local manufacturing, securing the company's presence in a fast-growing market.

Cipla already has a leading position in Yemen with over 200 products, it added.

Closing of the transaction is subject to completion of certain conditions precedent, it added.

As part of its global expansion, Cipla had completed the buyout of South African pharma firm Cipla Medpro for Rs2,707 crore last year. It had also acquired Croatia-based firm Celeris, distributor of its products in that country last December.

Shares of Cipla rallied as much as 1.4 per cent today after the pharma major said that it has signed a definitive agreement to acquire a 51 per cent stake in a pharmaceuticals manufacturing and distribution business in Yemen for $21 million.