Biocon India is splitting its operations into two strategic business units -
biotechnology, and contract research. In the process it is converting three of its group
companies - Helix Biotech, Biochemizyme India, and Biocon Quest - into fully-owned
subsidiaries of Biocon India. Syngene International, another group company specialising in
contract research, will continue to operate as a separate entity.
The move is aimed at listing Biocon and Syngene in India and eventually on the
Nasdaq within the next 18-36 months. The proposed restructuring is aimed at improving
market value. Kiran Mazumdar-Shaw, chairman and managing director of Biocon India, says
that within the next one and a half to three years, the group will offer around 15-20 of
Biocon India''s and Syngene''s equity to private investors.
Meanwhile the share swap arrangement is being worked out to enable all shares to be
transferred to the flagship company, Biocon India. Post-transfer, 90 per cent of
Biocons equity will be owned by Ms Muzumdar Shaw and her husband John Shaw, and the
rest will be split between employees and shareholders.
Biocon India was started in 1978 to produce and market a range of food and non-food
industrial enzymes, hydrocolloids and food ingredients. Quest International, a Dutch
subsidiary of Unilever, then held 24 per cent in Biocon India.
Following the worldwide sales of Unilever''s speciality business in 1997 to ICI, the
Biocon group acquired Quest International''s 50 per cent equity in both Biochemizyme India
and Biocon Quest.
Biochemizyme India was floated in 1990 as a 100 per cent export-oriented unit for
manufacture of speciality enzymes based on proprietary solid state fermentation
technology. Biocon Quest India was created in 1996 as a 50:50 joint venture company
between Biocon India and Quest International.
Syngene International was set up in 1994 as a contract research organisation, and Helix
Biotech was started in 1998 for diversifying the group''s activities into pharmaceutical
The group plans to start another round of an employee stock option plan, says Ms
Majumdar-Shaw. According to her,
following the listing of Biocon India in India and Nasdaq, all the fully-owned
subsidiaries will be eventually merged into Biocon India. Combined group sales are
expected to touch Rs 85 crore by March 2000.