Matrix to merge Vorin, Medicorp with itself

Mumbai: The Hyderabad-based Matrix Laboratories, a bulk drug manufacturer and an active pharmaceutical ingredients company, plans to merge Vorin Laboratories and Medicorp Technologies India with itself, say sources close to the development.

“The board of directors of Matrix will meet on 19 September 2002 to decide the swap ratio. After the merger is approved and the swap ratio finalised, the shareholders of Vorin and Medicorp will get Matrix shares,” add the sources. “The merger process is expected to be smooth as there is no overlap in the products of the three companies and the merged entity will be able to better utilise the capacities.”

Matrix holds a 55-per cent equity share in Medicorp, while the Chennai-based Shriram group holds 24 per cent stake; the rest is with public shareholders. Ranbaxy Laboratories holds a 51-per cent share in Vorin, non-resident Indians and overseas corporate bodies hold 15 per cent stake and the rest (34 per cent) is with public shareholders.

In the merged entity, Ranbaxy will continue to hold equity and the new entity will continue to do business with Ranbaxy, thus benefiting all the three companies, the sources say. “The shareholders of the merged entity are expected to benefit as the new entity will be able to better utilise the economies of scale and are being merged into a larger and successful company.”

Medicorp, which is also into the manufacturing of bulk drugs, has developed over 20 products and is expecting to get United States Food and Drug Administration approval for all the products going off-patent from 2003 onwards for the next seven years, the eighth annual report of Medicorp says. “The company’s main focus is on the advanced markets such as the US, Canada and Europe.”

Vorin Laboratories, a subsidiary of Ranbaxy Laboratories, is into the manufacture of bulk actives and other intermediates. Vorin supplies bulk ciprofloxacin and other intermediates to Ranbaxy, which is the largest pharma company in India in terms of sales.

For the year ended 2001-02, Medicorp had a net sales of Rs 40.65 crore and a net loss of Rs 4.83 crore. For the first quarter ended 30 June 2002, the company recorded net sales of Rs 10.08 crore with a net loss of Rs 1.33 crore.

Vorin Laboratories had a turnover of Rs 157.8 crore for the year ended 31 December 2001, with a net profit of Rs 0.92 crore. For the second quarter ended 30 June 2002, the company recorded a turnover of Rs 195.7 crore with a net loss of 3.11 crore.

Matrix recorded a turnover of Rs 103.88 crore for the year ended 31 March 2002 with a net profit of Rs 4.48 crore. For the first quarter ended 30 June 2002, the company recorded a turnover of Rs 50.68 crore with a net profit of 20.29 crore.