New word on the street about GlaxoSmithKline's interest in India's Dr Reddy's Laboratories: sources tell Reuters that Glaxo is looking a phased buy-in to the country's second-largest drugmaker. Such a deal would give Glaxo a bigger foothold in India, one of the fastest-growing drug markets, dovetailing with the company's current focus on emerging markets.
Here's how the details stack up. One option Glaxo is considering is buying a 20 percent share of the family holding company that has a 23.2 percent stake in Dr Reddy's Labs. That would be worth around $165 million. The company may also get the right of first refusal on part or all of the family's remaining stake in the drugmaker.
Glaxo is already in a partnership with Dr Reddy's, negotiated earlier this year, under which Glaxo can market a number of the company's products outside India. Taking an ownership stake in the company would be similar to Glaxo's purchase of a 16 percent share of Aspen Pharmacare, Reuters notes.
Nothing is final yet, of course. But Glaxo looks like the clear frontrunner for a Dr Reddy's deal. We'll have to wait and see whether it goes official.
- read the Reuters article