Special Correspondent

Enterprise value put at Rs. 30 crore

Plans investments in Watsol, Sibra for expansion

To increase high-value

anti-retroviral drug offering

HYDERABAD: Arch Pharmalabs Ltd., which operates in API (active pharmaceutical ingredients) and intermediaries business, has acquired Watsol Organics, a Hyderabad-based pharmaceutical and agro-chemical intermediates manufacturer.

Addressing a press conference here on Wednesday, Ajit Kamath, Chairman and Managing Director of Arch Pharmalabs, said Watsol Organics was acquired for an enterprise value of Rs. 30 crore. The company also acquired Sibra Pharmaceuticals, another Hyderabad-based company, in March this year for Rs. 40 crore. Both the acquired companies were in profits and there was no distress on their side.

Mr. Kamat said Arch Pharmalabs was proposing to invest Rs. 120 crore in both companies for expansion of capabilities. Arch Pharmalabs had acquired Merven Drug Products Ltd (an API and intermediaries business) in 1999.

The three facilities in Hyderabad were expected to contribute a topline of Rs. 500 crore by 2010. The company was targeting an overall turnover of Rs. 1,000 crore and a bottomline of eight per cent by 2010.

Sibra’s business would be consolidated and the unit would introduce new high-value APIs in technical collaboration with European majors. The Sibra unit was WHO’s good manufacturing practices-compliant.

The company proposed to increase the offering of high-value anti-retroviral drugs through Watsol, which would also be used for contract research and manufacturing services (CRAMS).

The company’s Gurgaon facility would be inspected for FDA standards soon. Private equity investors, including ICICI Venture, IL&FS, and Swisstec had a substantial stake in the company, which also had manufacturing facilities in Badlapur and Tarapur in Maharshtra.