Ranbaxy Daiichi
Ranbaxy – Daiichi Sankyo Deal
Akash Bangani Dipika Bhura Gaurav Khetan Neetu Rathod 12065 12077 12082 12118
Agenda
• • • • • • • • • • Industry Overview Companies’ Profiles Snapshot of the deal Financing the deal Benefits to Daiichi Benefits to Ranbaxy Synergies Post Acquisition challenges Recent Developments Conclusion
Indian Pharmaceutical Industry
• Present size of $14 billion. • Ranks 4th in world in terms of production and 13th in terms of consumption. • Highly fragmented. 325 large and medium-scale companies and 26000 small-scale companies. • Can be divided in 2 segments – Formulation and Bulk Drugs Market Share of segments
20% 80% Formulations Bulk Drugs
Porter’s 5 forces
Threat of Entry: MODERATE
Competition: HIGH
Porter’s 5 forces Model
Threat of substitute: LOW
Bargaining power of customers: MODERATE
Bargaining power of suppliers: LOW
Company Profile: Ranbaxy
• Incorporated in 1961. • The largest pharmaceutical company in India and among the top 100 pharmaceuticals companies in the world. • Ranked 8th largest generic drug company in the world. • Ground operations in 49 countries and manufacturing operations in 11 countries. • Exports contribute to around 80% of total revenues. • 2008-Global Sales of US $ 1,682 Million
Market Reach & structure: Ranbaxy
Shareholding before Deal
Revenue Diversification REGION North America Europe SHARE 26% 23% Category Promoters Domestic Institutions FII’s Holding 34.8% 23.3% 18%
India
Emerging Markets Developed Markets
21%
54% 40%
Shareholding after Deal Category Daiichi Sankyo Rest Holding 64% 36%
Others
6%
About Daiichi - Sankyo
• Established in 2005 , after the merger of two leading companies in Japan- Sankyo Company Ltd. & Daiichi Pharmaceutical Company Ltd. • Proprietary researched based pharmaceutical company. • Sales Splits:
Japan – 68% North America – 20% Europe – 9% Other – 3%
Daiichi – Sankyo (Current Data)
Snapshot of the deal
• On June
Akash Bangani Dipika Bhura Gaurav Khetan Neetu Rathod 12065 12077 12082 12118
Agenda
• • • • • • • • • • Industry Overview Companies’ Profiles Snapshot of the deal Financing the deal Benefits to Daiichi Benefits to Ranbaxy Synergies Post Acquisition challenges Recent Developments Conclusion
Indian Pharmaceutical Industry
• Present size of $14 billion. • Ranks 4th in world in terms of production and 13th in terms of consumption. • Highly fragmented. 325 large and medium-scale companies and 26000 small-scale companies. • Can be divided in 2 segments – Formulation and Bulk Drugs Market Share of segments
20% 80% Formulations Bulk Drugs
Porter’s 5 forces
Threat of Entry: MODERATE
Competition: HIGH
Porter’s 5 forces Model
Threat of substitute: LOW
Bargaining power of customers: MODERATE
Bargaining power of suppliers: LOW
Company Profile: Ranbaxy
• Incorporated in 1961. • The largest pharmaceutical company in India and among the top 100 pharmaceuticals companies in the world. • Ranked 8th largest generic drug company in the world. • Ground operations in 49 countries and manufacturing operations in 11 countries. • Exports contribute to around 80% of total revenues. • 2008-Global Sales of US $ 1,682 Million
Market Reach & structure: Ranbaxy
Shareholding before Deal
Revenue Diversification REGION North America Europe SHARE 26% 23% Category Promoters Domestic Institutions FII’s Holding 34.8% 23.3% 18%
India
Emerging Markets Developed Markets
21%
54% 40%
Shareholding after Deal Category Daiichi Sankyo Rest Holding 64% 36%
Others
6%
About Daiichi - Sankyo
• Established in 2005 , after the merger of two leading companies in Japan- Sankyo Company Ltd. & Daiichi Pharmaceutical Company Ltd. • Proprietary researched based pharmaceutical company. • Sales Splits:
Japan – 68% North America – 20% Europe – 9% Other – 3%
Daiichi – Sankyo (Current Data)
Snapshot of the deal
• On June