Ranbaxy detaches its research and development unitFebruary 19th, 2008 - 7:52 pm ICT by admin
Mumbai, Feb 19 (IANS) One of India’s largest drug manufacturers, Ranbaxy Laboratories, has approved the de-merger of its new drug research unit, which has been named Ranbaxy Life Science Research. The de-merger will result in cost savings of $25 million in the current year for the company.
Ranbaxy shareholders will get one share of face value Re.1 in Ranbaxy Life for every four shares held. The company has invested Rs.2 billion in the R&D arm by subscribing to redeemable preference shares.
After the de-merger, the equity capital of Ranbaxy Life will be Rs.126 million.
Ranbaxy and Ranbaxy Life Employees’ Welfare Fund will hold 19.8 percent and 4.9 percent of the equity, respectively. The public will hold the balance.
Ranbaxy Life will be listed on the National Stock Exchange and Bombay Stock Exchange (BSE). Approvals for the de-merger, including that of Punjab and Haryana High Court, are expected in the second half of 2008.
Shares of Ranbaxy Laboratories reacted positively by closing 3.95 percent higher on BSE at Rs.412. The stock jumped to a high of Rs.419 on the news. The traded volume was 484,832 shares against its two-week average of 275,812.