ORCHIDCHEM Cmp Rs.199 saw sudden sell-off with volumes after, Orchid Chemicals & Pharmaceuticals has agreed to sell its injectables business to the US-based Hospira for around $400 million (Rs 1,850 crore), a valuation that represents a 20% premium to the Chennai-based firm’s market value and greatly boosts its financial flexibility. The acquisition includes Orchid’s beta-lactam antibiotics manufacturing complex and pharmaceutical research and development facility at Irungattukottai in Chennai and its generic injectable product portfolio and pipeline.
Orchid's Managing Director K Raghavendra Rao said the sale of these assets will shave off $90 million in revenue but add 7-8 rupees a share to its earnings in fiscal year ending March 2011.
Analyst’s concern is Orchid has sold a valuable asset as the sold business contributed about 40% of sales and 50% of operating margins,and now upside for the stock maybe capped, it is hard to understand the impact but it would be better to avoid this stock and go for alternative like GLENMARK and JUBILANT Organosys which can see better performance in years to come.
RANBAXY’s move which holds 14% stake in Orchid would be keenly watched
http://www.vccircle.com/500/news/is-ranbaxy-exiting-orchid-chemicals The heavy trade of close to 30 mn shares across BSE-NSE triggered street talk that Ranbaxy has exited the investment. The country’s second largest drug-maker by revenues, Ranbaxy Laboratories, which is now controlled by Daiichi Sankyo, has sold part of its 14% stake in Orchid Chemicals triggering rumours that the Japanese firm may no longer be keen on continuing with the minority stake in Orchid.
http://economictimes.indiatimes.com/US-based-Hospira-to-buy-Orchid-Chemicals-injectables-biz-for-400-mn/articleshow/5342003.cms Orchid Chemicals & Pharmaceuticals has agreed to sell its injectables business to the US-based Hospira for around $400 million (Rs 1,850 crore), a valuation that represents a 20% premium to the Chennai-based firm’s market value and greatly boosts its financial flexibility. The acquisition includes Orchid’s beta-lactam antibiotics manufacturing complex and pharmaceutical research and development facility at Irungattukottai in Chennai and its generic injectable product portfolio and pipeline.
http://www.bloombergutv.com/industry-news/pharma-biotech-industry-news/40247/orchid-to-reduce-debt-after--400mn-deal.html Orchid Chemicals & Pharmaceuticals plans to eliminate long-term debt with the $400 million it will receive from the sale of its generic injectable drugs unit to Hospira Inc.
http://in.reuters.com/article/businessNews/idINIndia-44761120091216?feedType=nl&feedName=inmoney Orchid's Managing Director K Raghavendra Rao said the sale of these assets will shave off $90 million in revenue but add 7-8 rupees a share to its earnings in fiscal year ending March 2011.
http://www.ft.com/cms/s/0/84c436d8-e9a1-11de-9f1f-00144feab49a,dwp_uuid=a6dfcf08-9c79-11da-8762-0000779e2340.html?ftcamp=rss&nclick_check=1 India’s top business organisation is warning that a bill on land purchasing due to be introduced in parliament this week would hinder industrial development by making it more difficult for private companies to buy sites for big factories.
