Marksans Pharma, a Rs 240-crore plus Mumbai-based pharmaceutical company, has acquired RelonChem Ltd, one of UK's leading generic drug company for an undisclosed sum. RelonChem has clocked sales of US$ 32 million with adjusted EBITDA of US $5 million in 2007.

This will give Marksans an immediate sales and marketing front-end access to the highly regulated and lucrative generic medicines market in UK and Europe. Marksans is planning to shift manufacturing operations of RelonChem to its state-of-the-art facility in India. Marksans plans to use a combination of cash-in-hand and debt to fund the acquisition.

Commenting on the latest acquisition, Mark Saldanha, managing director of Marksans Pharma, said, "The acquisition gives us an immediate and deep marketing, distribution and sales presence in the highly profitable but regulated generic markets of UK and Europe. RelonChem is a profitable company with significant product licenses, demonstrated success in procurement of product dossiers, distribution and sale of pharmaceuticals. With its profitable operations and immense market opportunity, this acquisition will be profitable from the beginning, adding value to all our stakeholders. This is our second acquisition in Europe after Bell's & Sons and is a significant milestone which will become one of the key drivers to Marksans' global growth strategy."

John Ruprai, CEO, RelonChem Ltd, said, "All of us at RelonChem are excited to become a part of Marksans Pharma; we will together carry forward our market leadership in generic manufacturing in UK and Europe. A value added Indian manufacturing base of the company will give us tremendous cost benefits and create value among our customers locally. It is a strategic fit and we hope to serve our customers in a more efficient way in an ever increasing competitive market, thus adding value to the patient care system in UK and Europe."

Rajesh Vig, executive director, corporate finance, PricewaterhouseCoopers Ltd, the exclusive financial advisor to RelonChem for this transaction, said, "The acquisition of RelonChem by Marksans Pharma is another example of a strategic cross border M&As by mid-size Indian pharmaceutical companies. With global pharmaceutical companies facing tremendous pressure due to a drying R&D drug pipeline, rising costs and imminent generic competition from drug going off patent, the generic drug market is the next big opportunity for the industry. This acquisition will create value in front-end sales and marketing reach and back end manufacturing efficiency for Marksans while providing RelonChem with an ideal partner for future growth."

RelonChem is a leading pharma marketing and distribution provider with strong sales and marketing expertise; it is a supplier to major national distributors and global generic players in UK. It has very good technical and regulatory expertise with a highly reputable track record for attaining MHRA approval for the products, complex technical transfers and registration of new developments in Europe. It has a strong product portfolio and has granted 47 product licenses with 36 licenses pending in UK, Denmark, Finland and Ireland; 36 products are commercialized as of now. Its products cater to wide range of therapeutic segments like anti-infective, anti-depressant, antibacterial, anti fungal, cardio-vascular, anti-diabetes, anti-ulcer, analgesics and sex-hormones.