US-based Avenue Capital, a hedge fund that focuses on distressed and undervalued debt and equity opportunities, is in an advanced stage of negotiations to pick up an equity stake in Delhi-based loss-making pharma company Morepen Laboratories. Sources indicated that Avenue Capital could pick up 15% stake for around Rs 80 crore, and the deal which is expected to be completed by the middle of this month.
The fund is offering Rs 20 per share of Morepen Labs, which works out to a 28% premium to Friday’s market price of Rs 15.6. However, it is about 40% higher than the share price when negotiations between the two began.
The fund raising will help the company to substantially improve its capacity utilisation. Morepen is talking to MNC pharma companies in its attempts to secure long-term contract manufacturing. The company has set up a new facility for making paracetamol and currently manufactures 2,400 tpa of the drug which it plans to increase by the end of the year.
(Source: Economic Times
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment