The Mumbai-based company is seeking the shareholders approval at its forthcoming annual general meeting to "invest funds not exceeding Rs 50 crore in the share capital of other corporates engaged in the business of manufacturing, processing, conversion and/or selling of pharma, chemical or healthcare products or any other business which is ancillary or allied".

Shareholders had, at the company's previous annual general meeting, cleared a resolution to invest up to Rs 10 crore in the equity of other pharmaceutical companies.

The company is also proposing to amend its articles of association to facilitate the buy-back of shares in accordance with any amendment orre-enactment which may be made to the Companies Act, 1956.

German Remedies is promoted by a clutch of five German firms: Asta Medica AG, Beecham-Wulfing GmbH & Co K G Neuss, Boehringer Ingelheim International GmbH, Chemiewerk Homburg Zweigniederlassung der Degussa AG, Hellar Vermogensverwaltungs GmbH and Schering AG.

Asta Medica had earlier acquired the entire shareholding of Nordmark Arzneimittel GmbH in German Remedies, while Beecham Pharma had divested half its equity holding to Asta. Nordmark held 4.62 per cent of German Remedies equity, while Beecham had sold approximately 2.31 per cent of its stake in the company to Asta Medica taking the acquirer's holding to 6.92 per cent.

The shareholders approval is also being sought for the proposed induction of Humayun Dhanrajgir as director on the company's board. Dhanrajgir was appointed as an additional director by the German Remedies board at its board meeting held on March 10, 1998. Dhanrajgir, who also held a top management position at LupinLaboratories, is currently managing director of Kodak India.

INSIGHT
The right way to go

German Remedies is following the industry trend of consolidation by announcing investment of up to Rs 50 crore in other corporate entities, either in India or abroad, engaged in the pharmaceutical, chemical, healthcare or allied businesses. Considering the current industry scenario, it makes more sense to invest in a readymade company rather than start from scratch. Major pharmaceutical companies have consolidated their position in the recent past through the process of acquiring brands and taking over companies, and considering the strength of German Remedies, there is no reason why they should not do the same.