Matrix to acquire controlling stake in Concord Biotech

Our Corporate Bureau
06 December 2005

Matrix says overall, the acquisition will have incremental positive impact on its earnings potential, besides providing several other indirect advantages.

According to the term sheet executed, Matrix would acquire 55-per cent stake in Concord Biotech through a combination of purchase of existing equity shares from the promoters and other shareholders and subscribing to the new equity shares to be issued by Concord Biotech on a preferential basis.

Sudhir Vaid, the main promoter and the managing director of Concord Biotech, and his associates will continue to hold 29 per cent stake in the company. Other existing shareholders will hold a 16-per cent stake.

Vaid and his team will continue to spearhead the operations of the Concord reporting to the board in which Matrix will have majority representation.

Explaining the strategic rationale for acquiring controlling stake in Concord Biotech, N Prasad, executive chairman , Matrix Laboratories, said, "Our investment in Concord Biotech is in line with our strategic intent to acquire fermentation technology and manufacturing capabilities. This is a key step in the evolution of Matrix and this has come in at a time, when the major fermentation based products are going off-patent in the international markets. This investment will add statins, enzymes and immuno-suppressants to our product portfolio and hence widen the range of products offered to Matrix's customers".

Matrix laboratories has been in the news this year for developing a string of overseas linkages. In June 2005 it acquired a controlling interest of 22 per cent in Docpharma NV through its 100-per cent Belgian subsidiary Matrix Laboratories NV. In September it acquired a 43-per cent stake in the Switzerland-based Explora Laboratories SA, a research and development-focused company specialising in APIs and intermediates, thereby establishing its presence in oncology and hypotensive APIs.