Morepen gets shareholder nod to raise Rs 433 crore

NEW DELHI: Drug firm Morepen Laboratories on Friday said its shareholders have approved to raise Rs 433 crore through the allotment of shares. The company's shareholders in an Extra-Ordinary General Meeting (EGM) of the company on May 20, approved the issue and allotment of 58.50 million shares for cash to Switzerland-based Corinth Investment Holdings AG at Rs 41.60 per share aggregating to Rs 243.36 crore, Morepen Laboratories said in a regulatory filing.

The shareholders also approved the allotment of 50 million fully-convertible warrants to a promoter group company, Liquid Holdings, at Rs 38 per warrant/share aggregating up to Rs 190 crore for cash to be converted into equity within 18 months, within the limits prescribed in SEBI (SAST) regulations, it added.

"The investment by Corinth further bolsters our position as a market leader in Indian healthcare, it also endorses our approach in the self-diagnostic tools category along with the scale and potential of the Active Pharmaceutical Ingredients (API) market.

"It is a testing time for life sciences and pharma companies in these challenging times and are all geared to enhance our capacities and also expand our markets," Morepen Labs and Managing Director Sushil Suri said.

The Corinth Group, a global private investment group, after investing in the drug firm is now part of its promoter group.

"The investment into Morepen follows from our increased focus on emerging markets, and in particular the health and pharmaceutical industry. India is a key global market with significant growth opportunity, and we look forward to working with management to help the business develop while catering to a rapidly growing sector," Chairman of Corinth Group's Advisory Board Christopher Pissarides noted.

Morepen said it plans to utilise the raised capital to expand research and development (R&D) facilities and to set up a new USFDA standard API plant.

The company's shares were trading 3.13 per cent up at Rs 59.30 apiece on the BSE.