Even as a decision is pending on Pfizer's global animal health business, its Indian-arm has approved hiving off the local animal health business to its wholly-owned subsidiary for a consideration of Rs 440 crore.
The subsidiary, being formalised, will make the payment to Pfizer Ltd in cash and or through the issuance of shares (at par or premium), as decided by the company's board of directors, a Pfizer announcement said.
Pfizer's local animal health business is estimated at between Rs 130-150 crore, as on March 2011, a company official said. Responding to queries on whether the animal health business was on the block, the company official clarified that no decision had been taken on the alternative Pfizer would pursue on this business.
Last July, the US-based Pfizer Inc said that it was reviewing strategic alternatives for its global animal health business. And in connection with this decision, the company was taking internal steps to re-organise “to give Pfizer the broadest possible flexibility to pursue a range of possible transactions in the future.”
Earlier, after Pfizer had globally acquired Wyeth, the companies had announced the sale of some of its animal health assets to Boehringer Ingelheim. And this included Wyeth's Fort Dodge Animal Health portfolio in the US and Canada.
Domestic market
The animal health business in India, estimated at over Rs 2,000 crore, has seen much activity in the recent past, with multinationals coming into the market through acquisitions and others exiting from the business.
In 2009, Pfizer Animal Health had acquired Vetnex Animal Health Ltd – Ranbaxy's animal health business that had been divested to ICICI Venture. The transaction was about four years after Ranbaxy had decided to divest its allied businesses including its chemicals, diagnostics and animal health business to ICICI Venture Funds – in late 2005 – for an estimated Rs 150 crore.
In the same year, drug-maker Wockhardt sold its animal health division to French company Vétoquinol.
Earlier in 2006, GlaxoSmithKline Pharmaceuticals sold its animal health business to the French animal-health and veterinary products company Virbac for a consideration of Rs 207.1 crore, marking Virbac's entry strategy into India. And in 2003, Dutch company Provimi acquired the animal health division of Unichem Laboratories.