Union government has approved the proposal to transfer the equity shares of Karnataka Antibiotics & Pharmaceuticals Limited (KAPL), a joint venture between the Hindustan Antibiotics Limited (HAL) and the Karnataka government (also held by HAL) along with an additional investment of Rs 7.10 crore.
The centre's move to bring in KAPL under its control comes in only to help upgrade its manufacturing facilities of the public sector pharma major. The profit making KAPL has proposed to modernize its manufacturing facilities and also set up a new Cephalasporin plant at an estimated cost of Rs 22.45 crore.
Union minister of science and technology Kapil Sibal informed the Cabinet that by bringing in KAPL direct control of the Central government, the company would be able get monetary assistance from the Centre.
While KAPL has been a profit making company, its holding company HAL is not, he added. After the transfer of equity shares, the equity of the government of India and Karnataka government in KAPL would be in the ratio of 59:41.
The Bangalore-based KAPL is engaged in the manufacture of various life saving drugs and essential drugs. The company is promoted by HAL and the Karnataka government through the KSIIDC (Karnataka State Industrial and Investment Corporation).