Mumbai-based bulk drugs maker Unimark Remedies is in talks to sell its carbapenen business. Confirming this, a senior company executive told FE talks are currently focused around valuations. “There are several offers and we will decide the final price soon,” the official said. Carbapenens are antibiotics used to treat infections caused by multidrug-resistant bacteria.
Among potential buyers, sources say, are Cipla, Intas and Cadila. Pharma sector analysts believe the deal is potentially valued at R500 crore. Unimark’s revenues are about R800 crore.
Although reasons for the sale are not known, Unimark is likely to use the proceeds to settle much of its debt of about R500 crore in 2013. Rating agency Icra downgraded and later suspended the company’s ratings in December 2013 citing inability to carry out a rating surveillance in the absence of requisite information from the company.
Over the years the company has received equity investments. In 2008 the company received private equity investments from Citigroup Capital International and Swiss Tech who together picked up a 30% stake. Again in 2011 Nasdaq-listed Hikma Pharmaceuticals picked up a minority stake in the firm for around R148 crore.
The company is engaged primarily in the manufacture of bulk drugs (APIs), which constitute 76% of its total sales and include products such as montelukast, lisinopril and clecainide.
The company also has a presence in critical care and oncology products.
Located in Bavla, Gujarat, the carbapenen plant was commissioned in 2011 and was part of Unimark’s planned move into formulations and finished dosage forms.
Founded in 1983 by Mehul Parekh and Sandip Parekh as a pharmaceutical marketing company, in its initial years Unimark traded in pharmaceutical products of companies like Pfizer, BASF and UB Petro Products. The company entered API manufacturing in 1996 and set up a plant in Vapi, Gujarat. The company currently has three USFDA approved manufacturing facilities located at Vapi, Bengaluru, Khopoli (Maharashtra) and Bavla.
Proceeds from the sale will be used to pare debt of around R500 crore
Icra had downgraded and suspended Unimark’s ratings in December 2013
Equity investments have come from Citigroup International, Swiss Tech
Nasdaq-listed Hikma Pharmaceuticals also picked up minority stake