Temasek to invest Rs 945 cr in Glenmark Pharmaceuticals

Temasek Holdings (Private) Limited will invest Rs 945 crore in Glenmark Pharmaceuticals through its wholly owned indirect subsidiary Aranda Investments (Mauritius) Pte Ltd, the Mumbai-based pharma firm announced this on Friday evening.

The move, which gives Temasek close to 4 per cent stake in Glenmark, has been welcomed by analysts, who feel the move aimed at reducing the debt of the company would come as a relief to investors as this has been a source of concern.   

Now, with debt down, the interest costs will also fall.

The company, which has a total debt of $420 million intends to reduce it to about $270 million. While not elaborating more, Glenn Saldanha, Chairman & MD, Glenmark Pharmaceuticals, in a note sent by the company says, "We are pleased that one of the world's most reputed financial institution Temasek Holdings is considering investment in the company. Glenmark continues to remain committed to being a truly innovative led global organisation and will continue to invest significantly in building a strong product pipeline across geographies."

According to Glenmark Pharmaceuticals, Temasek Holdings (Private) Ltd, the investment arm of the Singapore government, is considering investing in the company through its wholly owned subsidiary Aranda Investments (Mauritius) Pte Ltd, (Aranda) in equity shared to be issued by the Company on a preferential basis.

At the board meeting held on Friday, Glenmark says, it was "decided to raise funds by way of issue of up to 108,00,000 equity shares of Re. 1/- each on preferential basis for cash to Aranda, a foreign portfolio investor at a price of Rs 875 per equity share aggregating to Rs 945 crore, subject to the requisite approvals of the shareholders and any regulatory authorities, as may be required."

Also, in a note shared with the Bombay Stock Exchange, Glenmark informed that it was also decided to convene an extraordinary general meeting of the company on May 13, 2015 in Mumbai for obtaining shareholders' approval for the preferential issue of equity shares.

It also informed that the relevant date for the pricing of the preferential issue of shares would be April 13.