Drug majors Pfizer and Wyeth today said they will merge their India operations under a single brand as part of efforts to boost business.
The operations would be unified under 'Pfizer brand'.
The Board of Directors of Pfizer Ltd and Wyeth Ltd, in their respective meetings today, approved a proposal to merge Wyeth India with Pfizer India, Pfizer said in a statement.
"I am very pleased to announce that today the Board of Directors of Pfizer Ltd and Wyeth Ltd have given their approval to merge the two companies thus initiating an important first step towards the creation of a single Pfizer brand," Pfizer India and Wyeth India, Managing Director, Aijaz Tobaccowalla said in the statement.
"I strongly believe that this merger will increase long term value for all stakeholders," he added.
The combined entity will have an increased therapeutic presence and a de-risked business profile, Tobaccowalla said adding that the merger process would require several approvals, Tobaccowalla said.
"We anticipate this will take approximately another nine months," he added.
The board of directors of Pfizer and Wyeth have also announced an interim dividend of Rs 360 per share and Rs 145 per share respectively.
In October 2009, Wyeth USA merged with Wagner Acquisition Corporation, a wholly-owned subsidiary of Pfizer Inc and consequent to this merger Wyeth Ltd became a subsidiary of Pfizer Inc in India.
As per the scheme of amalgamation, the shareholders of Wyeth India will be issued shares of Pfizer India. The swap ratio which has been determined is 7 shares of Pfizer India for every 10 shares held by the shareholders of Wyeth India.
"The above swap ratio is based on the valuation carried out by independent accounting firms, after taking into account the payment of the interim dividend as set out above, and is on a post dividend basis," the statement said.
The recommended swap ratio has been reviewed by merchant bankers who have issued separate fairness opinions to the respective Board of Directors, the two companies said.
"Based on the proposed merger swap ratio, Pfizer India will issue approximately 15.9 million new equity shares to Wyeth India shareholders, as consideration for the merger," it added.