New Delhi, Apr 9 (UNI) Pharma major Ranbaxy Laboratories today said it does not believe in hostile takeovers and will soon come out with a reaction on the recent reports of a takeover bid of a Chennai-based Orchid Chemicals and Pharmaceuticals.
Refusing to comment on the developments, a Ranbaxy spokesperson told UNI that ''we are coming to know of the developments through the media. We do not believe in hostile takeovers.'' Media reports had said a creeping acquisition (9.54 per cent) has begun in Orchid Chemicals and Pharmaceuticals after its share price fell last month by Solrex Pharmaceuticals Company, which is part of Ranbaxy.
Ranbaxy Managing Director and CEO Malvinder Singh had earlier talked about consolidation in the relatively quiet pharma industry.
Orchid shares were beaten down on March 17, when promoter holdings of about 7.5 per cent were sold by stock dealers.
Incidentally, the name 'Solrex' bears a close resemblance to Ranbaxy's two business divisions 'Solus' and 'Rexcel', which were created in 2002 as part of the company's restructuring programme.
With Ranbaxy refusing to clarify, it was unclear whether Solrex could be a Ranbaxy unit or a firm floated by its promoters.
Orchid reportedly has a revenue of Rs 866 crore and a net profit of Rs 169 crore for the nine-month period ended December 2007.
It has a return on capital of about 11 per cent and a market capitalisation of Rs 1,400 crore.
UNI MP/RT SBA ND1818