Cipla to pay $26 mn upfront for 51% stake in Ugandan firm

Drug major Cipla has re-negotiated payment terms for acquiring majority stake in Uganda's Quality Chemicals and now decided to pay USD 26 million (around Rs 166 crore) upfront to the shareholders of the African firm.

New Delhi: Drug major Cipla has re-negotiated payment terms for acquiring majority stake in Uganda's Quality Chemicals and now decided to pay USD 26 million (around Rs 166 crore) upfront to the shareholders of the African firm.

Cipla (EU), a wholly-owned subsidiary of the company, has re-negotiated the terms of the agreement and have entered into an amendment for upfront payment of the consideration amount instead of payment in tranches over a period of 5 years, the Mumbai-based company said in a statement.

"Accordingly, the revised consideration is around USD 26 million (USD 25,995,730) payable upfront upon completion of conditions precedent," it added.

In May, Cipla had inked a pact with Quality Chemicals Ltd (QCL) to acquire majority stake in it for a total consideration of over USD 30 million (around Rs 190 crore).

Cipla (EU) had entered into a definitive agreement to acquire a 51 percent stake in Quality Chemicals Ltd (QCL) from its existing shareholders.

As per the agreement inked earlier, the cash consideration for 51 percent stake was payable in tranches with around USD 8 million payable upfront on completion and 5 equal installments of USD 4.41 million payable at annual intervals thereafter.

QCL was incorporated in the year 1997 and is engaged in the business of import and distribution of pharmaceutical and consumer products

Cipla shares today ended at Rs 678.30 apiece on the BSE, up 0.68 percent from previous close.

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