Dr. Reddy's Laboratories, India's second largest pharmaceutical company, created waves when it acquired the Germany-based betapharm in February 2006, in the largest ever cross-border acquisition by any Indian drug maker. The deal valued at 480 mn ($576 mn) was an all-cash deal. betapharm has, over the years, emerged as the fourth largest generics company in Germany after Hexal, Ratiopharm and Stada, and commands almost 3.5% of the market share. The acquisition gives India's second largest firm a strong foothold in Germany (the world's third largest pharmaceutical market after the US and Japan) and the largest market in Europe. "betapharm was the ideal vehicle for the company to make its presence felt in the continent," commented DNA, India's leading daily.
s said that Dr. Reddy's would leverage on its low-cost manufacturing and betapharm's strong marketing network to push its products in Germany and other parts of Europe. Commenting on the acquisition, Dr. Anji Reddy, Chairman, Dr. Reddy's Laboratories, said, "Today is truly an exciting day for Dr. Reddy's. We see our investment in betapharm as a key strategic initiative towards becoming a mid-sized global pharmaceutical company with strong presence in all key pharmaceutical markets. betapharm has created a strong growth platform and is well-positioned for the future and we are looking forward to partner with them in building a strategic presence in Europe."
betapharm Arzneimittel GmbH was founded in Augsburg in 1993. With around 150 active pharmaceutical ingredients, its products cover almost all illnesses, from common cold to serious cardiovascular diseases. The company employs a workforce of more than 350 people and has posted a turnover of 186 mn in 2005. 3i, Europe's leading venture capital firm, invested in betapharm in March 2004. Since then, 3i has been actively helping the company develop its business activities, particularly in product sourcing.
Commenting on the strategic initiative, G V Prasad, Vice-Chairman and CEO, Dr. Reddy's Laboratories, said, "We are very excited with our strategic investment in betapharm." He further added, "The combination of these two companies will enable betapharm to continue to expand its growth trajectory and at the same time provide a strong foundation to leverage Dr. Reddy's global product development and marketing infrastructure to build a significant generics business in Europe in the long-term."
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