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Reliance Life gulps UK biotech firm

Mumbai, Feb. 7: Reliance Life Sciences has acquired GeneMedix Plc, a UK-based biotechnology company which is listed on London and Singapore stock exchanges, for a sum of £14.6 million (about Rs 126.83 crore).

Shareholders of GeneMedix approved the acquisition at an extraordinary general meeting on January 12 at its headquarters in Newmarket, UK. This is the first-ever overseas acquisition of a listed biopharmaceutical company by an Indian firm. Reliance Life Sciences had inked the deal to acquire GeneMedix in December last year.

Reliance Group chairman Mukesh Ambani said, “We envisage GeneMedix as an important enabler of our global life sciences business aspirations, with significant potential for contribution in the biopharmaceutical space.”

The acquisition will come through by way of subscription. Reliance Life Sciences will subscribe to 116.8 crore additional shares of GeneMedix at 1.25 pence per share amounting to £14.6 million.

This represents a shareholding of 74 per cent of the enlarged equity of GeneMedix. The deal also involves a five-year warrant option for Reliance Life Sciences for a further 140.4 crore shares at 1.25 pence apiece to enable infusion of an additional £17.5 million. This would take the shareholding of Reliance Life Sciences in GeneMedix to 86 per cent.

Reliance Life Sciences said the acquisition would provide it an opportunity to enter the European biopharmaceutical market by leveraging its wide portfolio of therapeutic proteins under development with a complementary product portfolio of GeneMedix as well as with the manufacturing facility of GeneMedix for production of clinical trial lots.

Reliance Life Sciences has recently entered the Indian market with five plasma protein products and has other products under development in specialty plasma proteins and novel proteins. It operates a pilot-scale biopharmaceutical manufacturing facility in Mumbai to manufacture plasma proteins. Reliance Life Sciences is now building three commercial scale facilities at its Navi Mumbai campus and these would be operational in 2007.

The acquisition provides much needed funds to GeneMedix for clearing debts and supporting product development of its lead biosimilars — erythroprotein.

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