Reckitt Benckiser to acquire Paras Pharma for $728 mn
By IANSMonday, December 13, 2010
NEW YORK - British consumer goods giant Reckitt Benckiser (RB) Monday said it would acquire Indian pharmaceuticals firm Paras Pharma for $728 million (Rs.3,260 crore), joining other global companies who have acquired firms to advance their footprint in one of the fastest emerging economies of the world.
Paras Pharma, based in Ahmedabad in Gujarat, is the maker of popular products in the Indian market such as Moov, a topical analgesic pain ointment, D’ Cold, a cold and flu remedy, and Krack, a medicated ointment for cracked heels.
Reckitt will buy the 63 percent stake of private equity firm Actis and shares of the promoter Patel family, including Paras founder Girish Patel, the global FMCG said in a statement.
Girish Patel and family hold 30 percent of the stake in Paras Pharma and the remaining 10 percent is held by other investors, including Sequoia Capital. Actis had hiked its stake to over 60 percent in 2008 and was scouting for suitors for a controlling stake in the company.
Paras Pharma logged net sales of Rs.401.4 crore ($89 million) in the financial year ending March 2010 and an EBITDA (earning before interest, taxes, depreciation and amortisation) of Rs.108.3 crore ($23 million).
“The acquisition of Paras is another step forward in Reckitt Benckiser’s growth strategy in consumer healthcare. It creates a material healthcare business in India, one of the most promising healthcare markets in the world with the addition of a number of strong and leading brands,” said Bart Becht, chief executive of Reckitt Benckiser.
Reckitt Benckiser has a strong portfolio led by 19 global power brands including Dettol, Harpic, Durex, Lysol and Vanish.
Girish Patel, founder and chairman of Paras, said: “We have been on a rewarding journey with Actis and the quality of our partnership has proved to be the key reason for the recent success of the company. I believe RB will take our already strong brands to the next level.”
Reckitt Benckiser was advised on the deal by JP Morgan, while Actis and the other Paras shareholders were advised by Morgan Stanley.
