Thursday July 19, 02:03 AM
Biocon to sell enzymes unit |
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Bangalore-based biotechnology major Biocon Ltd announced on Wednesday that it would sell of its enzymes business, with which it began a long march to biotechnology nearly 30 years ago, to Denmark-based Novozymes A/S for $115 million.
The move is aimed at enabling Biocon to strategically focus on its biopharmaceuticals business, which has now become the core part of its operations that span clinical trial services and contract research as well. The enzyme business includes a broad range of industrial enzymes, food additives and process aids.
This transaction, subject to shareholder and regulatory approvals, would be completed by the end of the third quarter of calendar year 2007, Biocon said in a statement after it unveiled quarterly results. Biocon reported a 36 per cent jump in net profit to Rs 52.8 crore in the first quarter ended June 2007 as compared to Rs 38.9 crore in the corresponding period last fiscal. Sales during the quarter (on a consolidated basis) stand at Rs 270.8 crore as against Rs 211.5 crore in the same quarter of the previous year.
Company officials said on the completion of the divestment of its enzyme business, Biocon will concentrate its activities on its biopharmaceutical business units that include active pharmaceutical ingredients, (APIs), bilogicals and proprietary molecules that are both commercialised and under development. "Over the past decade we have clearly recognised the high growth trajectory of our biopharma business verticals and have progressively invested to build proprietary knowhow and global scale. We believe that this is the right time to divest our enzymes business and focus on our biopharma businesses", chairman and managing director Biocon Kiran Mazumdar Shaw said.
Steen Riisgaard, CEO of Novozymes, Biocon's activities had an "an excellent strategic fit" to his company's existing enzyme business. "We see several interesting and synergistic market opportunities, making this a very interesting acquisition," Riisgaard said. Biocon's enzyme business will be integrated into Novozymes South Asia Pvt. Ltd., a fully owned affiliate of Novozymes A/S. Allegro Capital Advisors acted as Biocon's investment bankers to the transaction.
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