Emami buys out Parikh stake for Rs243 crore; raises Zandu stake to 50 per cent

16 October 2008

Mumbai: FMCG major Emami Ltd today acquired the entire Parikh family stake of 18.18 per cent in Zandu Pharmaceuticals for an estimated Rs243 crore.

Emami also acquired an additional 37,417 shares of Zandu for about Rs5.4 crore in open market transactions, taking its total holding in the Mumbai-based company to 50 per cent.

Under the deal, which ended months of hostility, Emami paid Rs15,000 per share and an additional non-compete fee of Rs1,500 per share for acquiring the 1,46,643 shares that the Parekh family held in Zandu.

Emami can now offer to acquire another 20 per cent in Zandu, taking its holding further to 70 per cent.

The acquisition makes Emami the largest shareholder of Zandu and the transaction effectively paves the way for Emami's acquisition of Zandu.

''We view this transaction as an important step in the growth of Emami and believe that Zandu's product line will provide us with opportunities in markets in India and across the world. The marriage of Zandu and Emami will change the landscape of the consumer products sector in India,'' Harsh V Agarwal, director of Emami, said.