Sanofi plans Rs450-cr OTC deal with Universal Medicare

Aventis Pharma, the Indian arm of French drug giant Sanofi, is planning to enter into a strategic Rs450-crore ($109.5 million) deal with Mumbai-based Universal Medicare in order to expand its over-the-counter (OTC) business in India, The Economic Times today reported, citing a person close to the deal.

Paris-based Sanofi, which in May this year shortened its name from Sanofi-Aventis by dropping Aventis, is likely to acquire a majority stake in the privately-held Indian drugmaker or its key OTC brands.

Universal, owned by Vikram Tannan and family, has been making nutraceutical products for over two decades and has a tie up with Geltec Private Limited, the world leader in patented Soflet / Geltab technology, and one of Asia's largest manufacturers of soft gelatin capsules.

With its two manufacturing facilities located in Gujarat and Bangalore, Universal has more than 40 products that include the popular cod liver oil capsules brand Seacod that has been part of almost every Indian household for more than 50 years.

It also has other OTC products to in therapy areas such as arthritis management, osteoporosis, women's healthcare, infertility and pain management, all of which, had sales of Rs115 crore.

Another executive privy to the talks told the paper that investment banking firm O3 Capital has been hired to conduct sale and Universal has also held talks with Abbott Laboratories and GlaxoSmithKline.

The products included in the deal have annual sales of Rs115 crore. Aventis Pharma reported net profit of Rs231 crore for the year ended December 2010 on sales of Rs1,085 crore.