China's Fosun Pharma Planning To Sell India's $3.6 Billion Gland Pharma: Report

Hyderabad-based Gland specialises in injectable drugs such as antibiotics, oncology and cardiology treatments and has a presence in about 60 countries

Fosun Pharma acquired a 74 per cent stake in Gland for about $1.1 billion in 2017 from an investor group including KKR & Co.

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Chinese billionaire Guo Guangchang’s Shanghai Fosun Pharmaceutical Group Co. is planning to sale its Indian drugmaker Gland Pharma Ltd. after receiving interest from potential buyers, citing people familiar with the matter news agency Bloomberg reported.

According to sources privy to the matter, Fosun Pharma, a listed arm of Chinese conglomerate Fosun International Ltd., has been working with an adviser as it informally gauges interest in its controlling stake in Gland. Companies in the industry and buyout firms are in the early stages of studying the business, the people said.

Shares of Gland jumped as much as 5.7 per cent in Mumbai following the Bloomberg report, their largest intraday increase in almost a month. They have fallen about 53 per cent this year, giving the company a market value of $3.6 billion. Fosun Pharma shares in Hong Kong rose as much as 5.4 per cent.

Hyderabad-based Gland specialises in injectable drugs such as antibiotics, oncology and cardiology treatments and has a presence in about 60 countries, according to its website.

A sale would help Gland’s Chinese owner raise cash as the once-acquisitive group seeks to shore up its balance sheet. Fosun International has been exploring options for a number of assets, including French resort operator Club Med and some domestic food and beverage operations, Bloomberg reported.

Fosun Pharma’s high valuation expectations could present a hurdle to any potential deal amid a tough financing environment, the people said. It hasn’t kicked off a formal sale process, and there’s no certainty the deliberations will lead to a transaction, the people said.

Representatives for Fosun Pharma didn’t immediately respond to Bloomberg’s requests for comment, while a spokesperson for Gland declined to comment.

Fosun Pharma acquired a 74 per cent stake in Gland for about $1.1 billion in 2017 from an investor group including KKR & Co. It listed the business three years later in an $873 million initial public offering in Mumbai, according to data compiled by Bloomberg.