Mumbai, May 21 (IANS) The British subsidiary of Indian drug major Cipla Ltd has acquired 51 percent equity stake in Uganda-based Quality Chemicals Ltd for $30 million (Rs.191 crore) in tranches from its current shareholders.
As per the agreement, both companies signed on Thursday, Cipla (EU) Ltd will pay $8 million (Rs.51 crore) upfront and the balance amount of Rs.140 crore in five equal installments of $4.41 million annually to the shareholders.
The transaction is expected to be completed by July.
The 18-year-old Kampala-based Quality imports and distributes drugs and consumer products in the east African nation. Incorporated in 1997, it is engaged in the business of import and distribution of pharmaceutical and consumer products.
Quality also holds 22 percent equity stake in another Cipla subsidiary in Uganda – Cipla Quality Chemical Industries Ltd.
“Post acquisition, our stake in the Ugandan subsidiary will increase to 62.3 percent from 51.05 percent and strengthen our presence in the African market,” the company said in a regulatory filing to the Bombay Stock Exchange (BSE).
Quality’s turnover declined to Ugandan shilling 14.85 (approx.$4.98 mn) billion in calendar year 2014 from 17.02 billion in 2013.