Just 10 days after Wockhardt said it was selling its business in Germany, the debt-ridden drug-maker has announced that it is divesting its animal health division to France’s Vétoquinol for an undisclosed sum.
Wockhardt’s animal health business clocked sales of Rs 77 crore for the year ended 2008 and was on the block as part of Wockhardt’s efforts to restructure debt. The company had a debt of Rs 3,400 crore for the year ended 2008.
The transaction is reportedly an estimated Rs 170-crore deal, according to a person familiar with the development. Company officials were not available for comment.
Subject to approvals, the deal is expected to take effect in the second half of 2009, a Wockhardt note said on Sunday, ahead of Wockhardt’s shareholder meeting on Monday.
Vétoquinol is an independent veterinary pharmaceutical laboratory in the companion animal and livestock markets.
About 160 people are believed to be part of Wockhardt’s animal health business, though the products were made through third-party manufacturers.
More than a week ago, Wockhardt had divested its German business Esparma to Mova GmbH, a subsidiary of Lindopharm GmbH, Germany, in a deal tipped at about Rs 120 crore. The company has stated its intent to exit non-core businesses, besides looking at strategic partners for its biotech and hospitals businesses.
Wockhardt’s initiative to divest its non-core business is a step towards its continued growth plan and a firm focus on its core human pharmaceutical business, the company said. “Wockhardt is re-inventing itself by taking fundamentally strong and positive steps by restructuring and rationalising its businesses to raise fresh capital and gain investor confidence,” it added.
Source: The Hindu Businessline