Fosun Pharma ‘plans to sell’ stakes in Indian drug maker
Shanghai Fosun Pharmaceutical Group is planning to sell controlling stakes in Indian drug maker Gland Pharma after receiving interest from potential buyers, people familiar with the matter have said.
Fosun Pharma, a listed arm of Fosun International, had been working with an adviser as it informally gauged interest in its controlling stake in Gland, the sources said.
Companies in the industry and buyout firms were in the early stages of studying the business, the sources said, asking not to be identified because the matter was private.
Shares of Gland jumped by 5.7 per cent in Mumbai following the news, their largest intraday increase in almost a month. They have fallen by about 53 per cent this year, giving the company a market value of US$3.6 billion. Fosun Pharma shares in Hong Kong rose by as much as 5.4 per cent.
Hyderabad-based Gland specialises in injectable drugs such as antibiotics, oncology and cardiology medicines and has a presence in about 60 countries, according to its website.
A sale would help Gland’s Chinese owner raise cash as the group seeks to shore up its balance sheet. Fosun International had been exploring options for a number of assets, including French resort operator Club Med and some domestic food and drink operations.
Fosun Pharma’s high valuation expectations could present a hurdle to any potential deal amid a tough financing environment, the sources said, adding that the firm had not yet kicked off a formal sale process, and there was no certainty the deliberations would lead to a transaction.
Representatives of Fosun Pharma did not respond to requests for comment, while a Gland official also declined to comment.
Fosun Pharma acquired a 74 per cent stake in Gland for about US$1.1 billion in 2017 from an investor group. It listed the business three years later in an US$873 million initial public offering in Mumbai.