Pfizer India also said it will be paying an interim dividend of R360 per share to Pfizer shareholders and Wyeth will pay R145 per share to Wyeth stockholders.
The total consideration for each share of Wyeth, calculated on basis of Pfizers closing price on Friday, amounts to a premium of 41% over Wyeths closing price on Friday, inclusive of the dividend paid to Wyeth shareholders.
Wyeth has about 1.11 crore shares in the market. Pfizer through Wyeths parent companies in the United States owns about 1.16 crore shares, according to shareholding pattern as on September 30.
Pfizer said post the swap, about 15.9 million shares of Pfizer will be issued to Wyeth shareholders.
Pfizer India managing director Aijaz Tobaccowalla said the Wyeth sales representative team of about 320 persons and the employee base of about 480 persons will be merged into the parent company and no significant restructuring is to be expected.
Post the merger, Pfizer India expects to be ranked ninth in India in the overall pharmaceutical market.
Tobaccowalla also said the merged company will remove focus from low potential target areas and re-deploy resources in the branded generics category an area of high potential.
He added that the company chose to proceed with the merger at this stage in order to optimise their functioning and also to market both the companies products under a single brand, which is more efficient.
Tobaccowalla said the company had looked at potential acquisitions in India before considering the merger.
We looked at opportunities in the marketplace. The reality of it is, given the multiples that are expected in the market at this stage and realisation of that investment, we dont think it is the best time for an acquisition, he said at a press conference to announce the merger.
Bajaj Allianz Life Insurance and chemical manufacturer Atul Ltd own more than 5% of Wyeths shares.
Other investors which hold more than 1% stake include Life Insurance Corp of India and UTI. Tobaccowalla said he expects shareholders to be supportive of the merger.