Wednesday, March 12, 2014

Glaxo Smith Kline has a billion dollars to spare

At this stage when India is grasping for breath any small investment should be considered good news. Others are watching and (as our moneyed friends tell us) businessmen like the fact that other businessmen are planning to invest. As the "market sentiment" is boosted more money flows in....and then one (not so) fine day the tide recedes and the money flows out again.

But then what is this we hear about the recent patent dog fights and the imminent threat of sanctions? Big pharma being (very) displeased with India? Guess it is all a riddle wrapped up in an enigma.

Glaxo Smith Kline said on Monday it had paid 64 billion rupees ($1.05 billion) to increase its stake in its Indian pharmaceuticals unit to 75 per cent, as it banks on rising demand for medicines in emerging markets.

Britain's biggest drugmaker first announced plans to lift the holding in Glaxo Smith Kline Pharmaceuticals from 50.7 per cent in December. It held an open offer to buy the extra shares at 3,100 rupees each from Feb. 18 to March 5. Final payment for shares tendered and accepted will be completed by March 20, GSK added. 

David Redfern, GSK's chief strategy officer, said the decision to increase exposure to the Indian market was "a significant vote of confidence" in growth prospects for its business in India.

GSK, which has had a presence in India for 90 years, is keen to secure a bigger share of India's growing $14 billion-a-year market, which it views as promising despite recent moves to impose price cuts and limit patents on some medicines.
The open offer was managed by HSBC. 


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