CCI clears second largest deal ever in pharma sector, more details

Torrent Pharmaceuticals has received clearance from the Competition Commission of India (CCI) for its proposed acquisition of a significant stake in JB Chemicals & Pharmaceuticals. "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.

"Commission approves acquisition of JB Chemicals & Pharmaceuticals Ltd by Torrent Pharmaceuticals Ltd with voluntary modifications," the competition watchdog said in a post on X.

This will be the second biggest deal in the pharma sector ever after Sun Pharmaceutical Industries’ 2015 acquisition of Ranbaxy Laboratories. After stake purchase, JB Pharma will merge into Torrent.

The approval is contingent upon the companies accepting certain voluntary modifications, as outlined by the CCI. Upon completion of the transaction, Torrent Pharma is set to become India’s second most valued pharmaceutical company, with plans for JB Chemicals to merge into Torrent following the share purchase.

The regulatory nod follows Torrent Pharma’s June announcement outlining its intent to acquire a 46.39% stake in JB Chemicals from Tau Investment Holdings Pte Ltd, an affiliate of global investment firm KKR, for approximately ₹11,917 crore.

The company also intends to purchase an additional 2.80% stake from select employees for ₹719 crore. As mandated by Sebi’s listing regulations, Torrent Pharma will subsequently make an open offer to acquire up to 26% more of JB Chemicals, totalling ₹6,842.8 crore.

This transaction marks the second largest deal in India’s pharmaceutical sector, following Sun Pharmaceutical Industries’ acquisition of Ranbaxy Laboratories in 2015.

"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.

Torrent Pharmaceuticals is the flagship company of the Torrent Group, with annual revenues exceeding ₹11,500 crore and group revenues of ₹45,000 crore. JB Chemicals & Pharmaceuticals brings a portfolio spanning finished dosage formulations and active pharmaceutical ingredients,

in addition to contract development and manufacturing organisation services. The deal’s approval by the CCI places it among the notable transactions in the sector.