Ranbaxy acquires South African firm for Rs 315 cr
In yet another overseas takeover, India’s largest drug maker Ranbaxy on Monday acquired South African drug firm ‘Be-Tabs Pharmaceuticals (Pty) Ltd’ for 70 million dollars (about Rs 315 crore).
Be Tabs is the 5th largest generics player and the largest Penicillin manufacturer in South Africa. It has a strong Over The Counter portfolio with significant brand recognition, Ranbaxy said in a statement.
"The acquisition of Be-Tabs results in considerable synergies and strengthens Ranbaxy’s foothold in South Africa. It reinforces our position by expanding our portfolio in a key market that is exhibiting strong growth potential," Ranbaxy CEO & Managing Director Malvinder Mohan Singh said.
Earlier in the year, Ranbaxy had acquired Romania’s Terapia for 324 million dollars. Ranbaxy is not the only Indian drug firm acquiring companies overseas. Its competitor Dr Reddy’s Laboratories had acquired Betapharm of Germany for 483 million euros.
The statement said Be Tabs acquisition will significantly strengthen Ranbaxy’s South Africa operations and place the company amongst the top five generic players in the market.
Singh said the move would help Ranbaxy in providing effective disease management solutions in support of the South African government’s objective to make healthcare affordable to a wider cross-section of the population.
The transaction, however, is subject to requisite approvals from South Africa’s Competition Council authority and is expected to be completed in the first quarter of next calendar year, the statement said, adding, transaction will be funded from Ranbaxy’s FCCB proceeds.
It said the transaction is valued at 2.2 times of sales and 7.7 times of EBITDA multiples.
With sales of about 30 million dollars, Be-Tabs is the fifth largest generic company in South Africa and one of the most profitable companies in the market.
"We are pleased with the acquisition of Be-Tabs. It is our clear intent to accelerate our growth in the local market. Ranbaxy, with its India centric advantage is well positioned to leverage these competencies and capture the synergies unleashed in the process, for the benefit of the South African market," Ranbaxy South Africa CEO Desmond Brothers said.
South Africa is the largest pharma market in Africa, valued at close to two billion dollars (Private market size as per IMS), with a high potential for generic growth (IMS).