Novartis acquisition of Roche voting shares to have little impact in India

the acquisition represents 20 per cent of voting shares

Our Corporate Bureau

Mumbai, May 7: NOVARTIS’ global acquisition of 20 per cent voting shares in Roche is expected to have a minimal impact in India, albeit for the time being. Roche held a small stake of roughly 4 per cent in Nicholas Piramal some years ago (by virtue of its global takeover of Boehringer Mannheim), though top Nicholas Piramal (NP) officials on Monday said that the Swiss giant no longer has any stake in NP.

Roche, which had in 1993 sold its entire 74 per cent stake in NP, had made a re-entry subsequently in NP following its global takeover of Boehringer Mannheim. Nicholas Piramal had acquired Boehringer Mannheim’s Indian operations in 1997.

However, analysts say that what could be interesting is the future role of Roche’s 100 per cent subsidiary in India — Roche Scientific Company Pvt Ltd (RSCP). RSCP, analysts say, does registration work for Roche products which are marketed by NP. The Piramals have the first right of refusal on Roche products marketed in India, though analysts say that the latest deal may throw up interesting possibilities once the original deal with NP expires in a year or so. The Piramals have been marketing Roche products like Becozyme and Supradyn for several years now.

Novartis, on May 7, announced the acquisition of 32 million bearer shares of Roche, representing 20 per cent of the voting shares, at a price of Swiss Franc 151 per share, according to an official release. These shares were purchased as a package from BZ Gruppe Holding.

Novartis chairman and chief executive officer Daniel Vasella, in an official statement, said: “This is a long-term financial investment, which is also strategic in nature. We believe that we were the most logical buyer of the Roche share package offered by the BZ Gruppe. At present no collaboration has been discussed with the Roche management, although we hope that over time we will be able to explore areas of collaboration as Roche has good long-term business prospects.” Novartis India’s official spokesperson said that it was too premature to make any comment on the implications of the global announcement.