FMCG major Emami Ltd today acquired the entire Parikh family stake of 18.18 per cent in Zandu Pharmaceuticals for an estimated Rs243 crore.
Emami also acquired an additional 37,417 shares of Zandu for about Rs5.4 crore in open market transactions, taking its total holding in the Mumbai-based company to 50 per cent.
Under the deal, which ended months of hostility, Emami paid Rs15,000 per share and an additional non-compete fee of Rs1,500 per share for acquiring the 1,46,643 shares that the Parekh family held in Zandu.
Emami can now offer to acquire another 20 per cent in Zandu, taking its holding further to 70 per cent.
''We view this transaction as an important step in the growth of Emami and believe that Zandu's product line will provide us with opportunities in markets in India and across the world. The marriage of Zandu and Emami will change the landscape of the consumer products sector in India,'' Harsh V Agarwal, director of Emami, said.
''I am happy with the arrangement and feel confident that the shareholders of both companies will derive maximum benefit from this consolidation. As both companies have much in common relating to innovative product development based on the holistic healing system of ayurveda, I am certain that this transaction will lead to further enhancement of operational efficiency and will significantly contribute to the growth of Zandu and Emami,'' Girish G Parikh, managing director of Zandu, added.
Emami had bought a 24 per cent stake of erstwhile co-promoters of Zandu, the Vaidya family, in May, which was contested by the Parikhs who claimed first right of refusal.
Emami had to nearly double the price of its open offer to Rs15,000 from Rs7,315 to clinch the deal.
Emami and Zandu had been locked in legal battle at the Company Law Board, which, however, advised the two parties to find a mutually suitable solution to the issue.
Source: Domain B