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news.Daiichi Sankyo Company and Ranbaxy Laboratories have announced that a binding share purchase and share subscription agreement was entered into between Daiichi Sankyo, Ranbaxy and the Singh family, the largest and controlling shareholders of Ranbaxy.
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Pursuant to the agreement, Daiichi Sankyo will acquire the entire shareholding of the Singh family in Ranbaxy and further seek to acquire the majority of the voting capital of Ranbaxy at a price of INR737 per share with the total transaction value expected to be between $3.4 and $4.6 billion.
This purchase price represents a premium of 53.5% to Ranbaxy’s average daily closing price on the National Stock Exchange for the three months ending on June 10, 2008 and 31.4% to such closing price on June 10, 2008. On the post closing basis, the transaction would value Ranbaxy at $8.5 billion.
The closing of the transactions is subject to approval of shareholders of Ranbaxy and customary regulatory and statutory approvals. The acquisition is expected to be completed by the end of March 2009. Upon completion of the transaction, Ranbaxy is expected to become a subsidiary of Daiichi Sankyo.
Malvinder Singh will continue to lead the company as its CEO and managing director while additionally assuming the position of chairman of the board, upon closure.
Takashi Shoda, president and CEO of Daiichi Sankyo, said: “This complementary combination represents a perfect strategic fit and delivers a considerable opportunity for the future growth of the new Daiichi Sankyo Group. While both companies will closely cooperate to explore how to fully optimize our growth opportunities, we will respect Ranbaxy’s autonomy as a standalone company as well.”