Debt-laden Wockhardt is in talks with buyout giants to sell its India business

• One of India’s oldest drug manufacturers, Wockhardt is working on a deal to sell 46% of its stake in the domestic market.
  
• Apax Partners, Blackstone, Carlyle and KKR who are in the race for the ₹40-45 billion deal, have indicated interest to take up 51% shares.
  
• Wockhardt is the 22nd largest drug maker in India with 1.07% of domestic market share.
  
  

One of India’s oldest drug makers, Wockhardt is looking to sell its domestic pharmaceutical business. The drug-maker who has a wide chunk of interests in the US and Europe ---- is in talks with buyout funds Apax Partners, Blackstone, Carlyle and KKR to offload India business, according to reports.

Habil Khorakiwala, owner of Wockhardt is willing to sell 40% shareholding in the firm. Companies in the race however individually indicated that they are interested in buying at least 51% stake and its controlling powers.

The deal, when finalised, could value the drug manufacturing business at ₹40-45 billion. It might be a tough race for the buyer as another top Indian drugmaker Torrent Pharma has also shown keen interest in the company.

The deal is set to come amidst increasing debt problems for Wockhardt, which has piled up as much as ₹ 24.53 billion.

However, the losing streak for Wockhardt seems to be coming to an end. The company’s revenues stood at ₹41.58 billion for the fourth quarter, with its India business contributing 36%. Its European Union business contributed 32%, whereas 19% is accounted to the business in the US, as per reports.

Wockhardt had posted a loss of ₹ 6.08 billion in 2018.

The firm is the 22nd largest pharma company in India with significant presence in cardiology, dermatology, diabetes, respiratory diseases and ophthalmology medicines.

It laos launched nine new brands this year, like Aceroc, Biovac-B, Brozedex, Clopione and Zedex.

The firm’s market share in April 2019 stood at 1.07%, in a heavily fragmented Indian drug market.

“The domestic business is strong and has good growth potential,” said a top executive of a global private equity buyout fund. But the company’s weak finances have remained a concern for analysts.