Govt approves FDI worth Rs 4,000 cr in pharma sector
Proposals for foreign direct investment amounting to around Rs 4,000 crore by four pharma and medical devices firms, including Torrent Pharmaceuticals and Biocon’s research services arm Syngene, were today approved by the government. The government, however, rejected <g data-gr-id="33">proposal</g> of drug firm Strides Arcolab to issue shares to non-resident and resident equity shareholders of Shasun Pharmaceuticals and deferred three proposals from other firms.
Ahmedabad-based Torrent Pharmaceuticals’ Rs 3,000 crore proposal for increasing FII investment limit to 35 per cent from 13.09 per cent was the biggest in terms of value approved by the government on Wednesday based on the recommendations of Foreign Investment Promotion Board (FIPB) in its meeting held May 28, 2015. Syngene International’s proposal to raise FDI of around Rs 930 crore by raising the foreign investment to 44 <g data-gr-id="38">per cent</g> from the approved percentage of 10 <g data-gr-id="39">per cent</g> was the second biggest in the pharma sector approved by the government today. The company plans to raise the sum by way of initial public offering of equity shares to FIIs, FPIs and NRIs.
Approval was also given to FDI of Rs 43.52 crore for <g data-gr-id="42">Stericat</g> Gut Strings Pvt Ltd as it sought to sell 77.5 per cent stake to Groupe Peters Surgical LLC (22.5 <g data-gr-id="43">per cent</g> of which would be via share swap), an official statement said. Ordain Health Care Global Pvt Ltd also got the nod for its FDI proposal of Rs 23.34 crore to purchase certain assets pertaining to <g data-gr-id="44">Alkems</g> <g data-gr-id="45">Fertica</g> from Alkem Laboratories Ltd. The government, however, rejected <g data-gr-id="34">proposal</g> from Strides Arcolab for issuing shares to non-resident and resident equity shareholders of Shasun Pharmaceuticals Ltd under a scheme of <g data-gr-id="35">merger</g>. The other FDI proposals in the pharma sector which were deferred include Celon Laboratories, Shantha Biotechnics and Sparsha Pharma International.
Meanwhile, the government approved 16 foreign investment proposals, amounting to INR 6,750.86 crore. “Based on the recommendations of Foreign Investment Promotion Board (FIPB)... <g data-gr-id="26">Government</g> has approved 16 proposals of Foreign Direct Investment (FDI) amounting to Rs 6,750.86 crore,” Finance Ministry said in a statement. The proposals were cleared during the FIPB meeting held on May 28, it added.
However, a total of 21 proposals were deferred during the meeting and six others were rejected. Broadcaster Star India Private Limited has been given approval for further issuance and transfer of shares to its foreign collaborator and acquisition of another Indian company engaged in <g data-gr-id="28">broadcasting</g> sector on a slump sale basis.
Among others, FDI proposals of <g data-gr-id="40">Stericat</g> Gut Strings Pvt Ltd, BASF Chemicals India Private Ltd, Ordain Health Care Global, Berggruen Real Estates and Today Magazines Lifestyle, were also approved.
Traders oppose FDI in retail, <g data-gr-id="77">ecommerce</g>; HC asks Centre to take views
The Delhi High Court on Wednesday asked the Centre to treat as a representation a plea of a traders association which is opposed to FDI in multi-brand retail and e-commerce. Justice Mukta Gupta asked the Confederation of All India Traders (CAIT) to prepare a fresh representation, as the petition did not show how they were being impacted by the government’s FDI policy, and to send it to the Centre within a week. The court observed that while framing a policy the executive is required to take views of all the stakeholders <g data-gr-id="64">and</g> therefore, “it would be appropriate” that CAIT is also afforded an opportunity to be heard. It passed the order while disposing of the plea of CAIT which has alleged that the current policy of 51 per cent FDI in multi-brand retail was “creating an uneven playing field by giving a source of abundant resources and deep finance to large retailers and multi-national corporations”.