Neutra Health acquisition to facilitate entry into regulated markets: Elder Pharma

Our Corporate Bureau
26 July 2007

Alok Saxena, director, international, Elder Pharma, told CNBC-TV 18 in an exclusive interview, shared by the channel with domain-b, that it would not be making an open offer, but plans to take warrants and make the investment directly.

He sees the acquisition as an entry point into the regulated market.

Confirm for us this particular news - is it a 20 per cent stake? How much have you paid for it? Has the payment already been made?
Yes, we have put in an offer to buy 20 per cent in Neutra Health Plc, which is a company listed on the AIM stock exchange. For the 20 per cent, we will be putting in Rs 47 crore but the payment has not been made. It is subject to clearance from the EGM, which will take about 21 days from now. But they have accepted our offer and we hope everything will go forward as planned.

What do you stand to gain out of this?
Neutra Health is one of the largest companies in the UK specialising in neutraceutical products and this is one of the main areas where Elder is quite strong. We are amongst the top three companies in India in the neutraceutical market.

So, this will be a very strategic thing for both of us because we could backend our products and their products together. Their products could be marketed in the Indian market and our products could be marketed by them in the UK market. This would be an entry point for us into the regulated markets.

Give us more details on the market cap and pricing of this company, which is listed on the AIM? Would you have to make an open offer for it right now?
No, we won't be making an open offer for it. This company is listed on the AIM stock exchange. We plan to take warrants from the company and then, we will be making an investment directly into the company.