►On 21 May 2010, Abbott Laboratories announced the acquisition of the healthcare solutions business (domestic formulations business) of India based Piramal Healthcare for an up-front payment of US$2.12 billion. In addition to this, Abbott will also pay US$400 million annually for the next four years, beginning in 2011 .
► Abbott is a global health care company engaged in the discovery, development, manufacture and marketing of pharmaceuticals and medical products. ► Mumbai-based Piramal Healthcare Solutions is a leading provider of Indian branded generics, with a portfolio of around 350 products, including therapeutic areas such as antibiotics, respiratory diseases, diabetes and cardiovascular diseases.
►According to the terms of the agreement, Abbott will obtain access to Piramal's manufacturing facilities in Baddi in Himachal Pradesh as well as the rights to sell more than 350 brands in the domestic market .
►Around 5,000 employees of Piramal's Healthcare Solutions will now become part of Abbott, which will take Abbott’s headcount to 7,500 in India2. ►Piramal Healthcare will retain its Custom Manufacturing business, its Critical Care business, over-the-counter (OTC) Consumer Products business, bulk-drug manufacturing business and Diagnostics business2.
►Piramal will not engage in generic pharmaceutical business in India and other emerging markets for the next eight years2.
Implications of the deal
►Abbott could become the leading pharmaceutical company in India: Piramal’s Healthcare Solutions division is expected to generate more than US$500 million in revenues in 2011 and continue to grow at 20%, with sales reaching US$2.5 billion by 2020. With this deal, Healthcare Solutions and Abbott’s businesses will cumulatively become the market leader in India, with a market...