The Competition Commission of India (CCI) on Tuesday approved Torrent Pharmaceuticals Ltd’s proposed acquisition of a stake in JB Chemicals and Pharmaceuticals, subject to voluntary modifications offered by both companies.
The clearance follows Torrent Pharmaceuticals’ June announcement of its plan to acquire a majority stake in JB Chemicals and Pharmaceuticals in a ₹19,500-crore deal.
“The proposed combination relates to the acquisition of shareholding by Torrent Pharmaceuticals Ltd (acquirer) in JB Chemicals & Pharmaceuticals Ltd (target) and the subsequent amalgamation of the target with the acquirer,” the regulator said in a release.
Upon completion, Torrent Pharmaceuticals will become India’s second most valued pharmaceutical company. “The Commission approved the proposed combination subject to compliance with voluntary modifications offered by the parties (Torrent Pharmaceuticals Ltd and JB Chemicals & Pharmaceuticals Ltd),” it added.
Torrent Pharmaceuticals, the flagship company of the Torrent Group, is engaged in the manufacturing and sale of pharmaceutical formulations (FDFs) across multiple therapeutic areas.
Meanwhile, JB Chemicals and Pharmaceuticals manufactures and markets a wide range of FDFs and active pharmaceutical ingredients (APIs), while also offering contract development and manufacturing (CDMO) services.
“Commission approves acquisition of JB Chemicals & Pharmaceuticals Ltd by Torrent Pharmaceuticals Ltd with voluntary modifications,” the CCI announced in a post on X.
In June, Torrent revealed plans to acquire a 46.39% stake from promoters Tau Investment Holdings Pte Ltd, an affiliate of global investment firm KKR, for about ₹11,917 crore. Additionally, the company will purchase 2.80% from certain JB Chemicals employees for approximately ₹719 crore.
Following these transactions, Torrent will make an open offer for an additional 26% stake as per SEBI’s listing regulations, totaling around ₹6,842.8 crore.
The transaction marks the second-largest deal in India’s pharmaceutical sector, following Sun Pharmaceutical Industries’ 2015 acquisition of Ranbaxy Laboratories. After the share purchase, JB Chemicals will merge into Torrent Pharmaceuticals.
In 2020, KKR had acquired a 65% stake in JB Chemicals, later divesting 5.8% in March 2024 for ₹1,460 crore through open market transactions.
Torrent Pharma, which reports annual revenues exceeding ₹11,500 crore, is the flagship entity of the Torrent Group, which collectively generates ₹45,000 crore in revenue.
For context, Sun Pharma’s acquisition of Ranbaxy in 2014 was valued at USD 4 billion, including USD 800 million in debt, and was completed in March 2015. Another notable deal saw Mankind Pharma acquire Bharat Serums and Vaccines last year for ₹13,768 crore.
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