New Delhi: At over a billion dollars, it will be tough to match the Mylan-Matrix deal, but there are at least three more large-sized transactions in the offing in the Indian drug industry.
Industry experts say, large overseas companies have been watching the valuations and M&A movements in India very closely and now with a few Indian companies willing to sell part of their equity stakes, more deals could be signed over the next six months.
And this time, it may not just be a large front-end global generic company looking for a strong back-end presence in India.
Interest may also come from some global innovator companies looking at cost efficient manufacturing capabilities.
Investment bankers maintain that it’s a trend that's already triggered. While Ranbaxy and Dr Reddy’s acquired Terapia and Betapharm earlier this year for expanded presence, multinationals will logically look at Indian companies to gain process chemistry skills and cheap facilities.
However, expensive and unreasonable valuations may play spoilsport.
Consultants say with a majority of equity stakes in Indian companies held by promoters, negotiations have been rather tough on fair valuations.
But with the M&A buzz getting strong, some of the large Indian drug companies are set to see change of ownerships.
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