Tuesday June 30, 08:40 AM

Wockhardt eyes debt restructuring deal by Aug

By Bharghavi Nagaraju

MUMBAI (Reuters) - Drugmaker Wockhardt Ltd (WOCKPHARM.NS : 171.5 +1.1) hopes to sign a deal for corporate debt restructuring by August, even as it looks to divest some more of its non-core businesses over the next 6 months, its chairman said on Monday.

In March, Mumbai-based Wockhardt, said it would seek to recast its debt by approaching the corporate debt restructuring (CDR) cell and is now in talks with banks to work out a plan.

"We had a meeting of our CDR lenders last Thursday and I think the final details of this package is being worked out," Habil Khorakiwala told reporters after a shareholder meeting.

Asked if a CDR deal would be in place by August, he said "From all the indications available, that is likely to happen."

The CDR plan would look at recasting its domestic debt, even as the company looks at various options to restructure other debt, including the $108.5 million foreign currency convertible bond loans coming up for redemption in late-September-October.

Wockhardt is exploring options to buy back these bonds, he added.

As of December 31, Wockhardt had loans of about 42.35 billion rupees on its balance sheet, according to its annual report.

DIVESTMENT ON

The drug maker is also restructuring its businesses and units and selling those it considers non-core to its operations, as it seeks to raise funds for settling some of the debt.

Over the weekend, Wockhardt said it had signed a deal to sell its animal health division to France's Vetoquinol for an undisclosed amount. Two weeks ago, it sold its German business, Esparma, to Mova Gmbh, a unit of Lindopharm Gmbh.

Wockhardt would continue to sell some of its other non-core businesses over the next 3-6 months, Khorakiwala said.

"As a result of the entire approach of restructuring, we would be divesting but it would not be a very significant part of the company, both in terms of the top and bottomline," Khorakiwala said.

Separately, he added, Wockhardt Hospitals was in talks with strategic investors to sell stake or assets in the firm, hinting Fortis Healthcare Ltd could be one of the potential suitors.

The company was still working on the structuring of the sale, he added.

Earlier in June, India's top hospital chain Apollo Hospitals said it had dropped plans to acquire some hospital assets of Wockhardt Hospitals due to differences on valuation.

Wockhardt was offering a basket of hospitals in three cities -- Mumbai, Bangalore and Kolkata, Apollo's managing director, Preetha Reddy, had said.

Wockhardt Hospitals, promoted by the founders of Wockhardt Ltd, withdrew its initial public offer last year on poor investor response. Wockhardt Ltd has no stake in Wockhardt Hospitals.

(For more news on Reuters Money click http://in.reuters.com/money)