Glaxo, SmithKline boards approve merger

By Our Staff Correspondent

MUMBAI, FEB. 23. Glaxo India and SmithKline Beecham Pharmaceuticals (India) have proposed to merge their Indian operations following the merger of their global parents.

The board of directors of SmithKline Beecham Pharmaceuticals (India) met today to approve the scheme of amalgamation with Glaxo India and the directors of Glaxo India also approved the scheme of amalgamation paving the way for the merger of the two companies in India.

The boards have decided that Glaxo India will issue to the shareholders of SmithKline Beecham Pharmaceuticals (India) one equity share of Rs. 10 each credited as fully paid-up in the capital of Glaxo India for every two shares of Rs. 10 each held by the shareholders of SmithKline Beecham Pharmaceuticals (India). Arthur Andersen and N. M. Raiji & Co. were appointed by the boards to recommend a fair swap ratio for the merger.

The merger is subject to the approval of the shareholders of the two companies and of the High Courts of Mumbai and Bangalore. While the process is expected to be completed in the course of the year, the merger, when approved by the courts, will be effective retrospectively from January 1, 2001. The merged company will bear the corporate name GlaxoSmithKline Pharmaceuticals Ltd.

Mr. V. Thyagarajan, vice chairman and managing director of Glaxo India and managing director of SmithKline Beecham Pharmaceuticals (India), said, ``The merger marks a significant milestone in the history of both the companies. Apart from a market share of over 7 per cent, the merger offers us unique opportunities of synergising product portfolios and financial strengths. This will result in a strong bottomline aimed at enhancing shareholder value. Also on the agenda are initiatives for cost reduction and for optimal use of resources.''

Further, ``Glaxo and SmithKline Beecham have a high standing among the medical fraternity for the efficacy and quality of their products. The merger will give an opportunity to build on this goodwill to offer a bigger and complete basket of products, better and quicker service and easier accessibility to our medicines,'' he added.

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Section  : Business
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