Debt-ridden Wockhardt Ltd has divested its German business Esparma to Mova GmbH, a subsidiary of Lindopharm GmbH, Germany, for an undisclosed amount.
The development comes as the Mumbai-based drug maker sets about the process of restructuring its debt.
Wockhardt had acquired Esparma’s business, sales and marketing operations in May 2004 for Rs 49 crore ($11 million).
“Wockhardt continues to be on the growth track and this initiative is the first step towards its ongoing strategy to re-structure, rationalise and optimise all of its businesses and raise fresh capital by divesting some of its smaller operations and non-core businesses,” a Wockhardt note said.
According to a source familiar with the development, Esparma clocked sales of about €18 million for the year ended December 2008 and has around 25 employees.
Europe is Wockhardt’s single largest market, accounting for 54 per cent of its consolidated sales.
Wockhardt, however, was saddled with Rs 3,400 crore debt as on December 2008. The company has since stated its intent to exit its non-core businesses such as animal health, besides seeking strategic partners for its biotech and its hospitals business.
FORTIS deal?
And with Apollo Hospitals’ top-brass stating that they have dropped their plans to buy Wockhardt Hospitals, the unconfirmed buzz gaining ground in the market is that hospital retail-chain Fortis Healthcare was close to sealing a deal with the latter.
In the past, Wockhardt’s Executive Chairman Mr Habil Khorakiwala, had told Business Line that he was open to having a minority partner on board, sooner than later.
The deal was announced after market hours. Wockhardt shares were down 8 per cent on the BSE, at Rs 130 on Wednesday.
Source: The Hindu Businessline