Updated December 22, 2023 | 06:13 pm Eastern Time
Pharmaceutical firm Torrent Pharmaceuticals has scrapped a proposal to buy an equity stake in peer Cipla Ltd. following a lack of consensus on the valuation and terms of a potential deal, sources told ET NOW. Torrent Pharma, the front-runner in the deal, withdrew its non-binding offer for the stake, the sources said. Earlier this year, Cipla's founders, led by YK Hamied, had entered into talks with potential buyers, including global investors, to sell their stake of around 33.5% in Cipla. Torrent's withdrawal brings with it the future of the transaction, which could have potentially been the largest mergers and acquisitions transaction in history. India in 2023 had solved it, until reaching a dead end. The suitors who wanted to buy the founders' holding company differed in the Cipla promoters' perceptions of a possible valuation of the stake. The founders also had mutual disagreements over the modalities of the transaction and potential valuation issues, a key reason for the delay in finalizing the deal. Earlier, US private equity firm Blackstone backed out of the transaction, while a bid by Cipla's peer Dr Reddy's Laboratories failed to make concrete progress. India's booming healthcare and medicines industry has attracted growing interest from international investors, including private equity funds, who are looking for opportunities. in a country that surpassed China as the most populous this year. Ahmedabad-based Torrent had earlier approached private equity firms to set up a consortium to bid for Cipla's stake. The company had also committed financing to some banks in anticipation of the progress of its attempted purchase. Separate emails to Cipla and Torrent Pharma seeking comment on Torrent's withdrawal from the deal went unanswered.#torrentpharma #etnow #stockmarket #cipla
