Glaxo, Sanofi in talks for Shanta Biotch takeover
30 March 2009
GlaxoSmithKline and Sanofi-Aventis are reported to be in separate talks to buy a majority stake in Indian biotechnology firm that pionneered indigenous recombinant vaccines, Shantha Biotech.
According to the The Economic Times, the two European drug-makers are negotiating with France's Merieux Alliance, which owns 80 per cent of unlisted Shantha, the newspaper said, citing two unnamed people familiar with the matter.
The French company had acquired a 60-per cent stake in the Hyderabad-based bio-pharmaceutical firm from the Oman-based financial firms, which had invested in Shantha a few years ago that enabled the Indian company to develop its indigenous capabilities.
to strengthen its presence in India.
"The proposed deal will allow the buyer to get a majority stake and management control. Talks are at an initial stage and Merieux is looking at selling its entire 80 per cent stake," it quoted one source as saying. A deal could be worth up to Rs1200 crore ($237 million), it said.
Both Glaxo and Sanofi called the report speculative, while Merieux avoided commenting. Shantha's managing director K I Varaprasad Reddy, who holds 17 per cent of the firm, said Merieux regularly received collaboration proposals but he was not aware of any sale discussions, the report said.
In 1997, Shantha became the first Indian company to develop, manufacture and market India's first recombinant hepatitis-B vaccine, Shanvac-B, in 1997 followed by Shankinase (recombinant Streptokinase) and Shantetra, an indigenous 4-in-1 combination vaccine that prevents diseases like diptheria, pertusis, tuberculosis and hepatitis-B. (See: Shantha Biotech makes healthcare affordable).