Date:08/02/2006 URL: http://www.thehindubusinessline.com/2006/02/08/stories/2006020801740200.htm

Back Dr Reddy's to increase borrowing, investment limits

Our Bureau

Dr Reddy's proposes to seek the approval of its shareholders through postal ballot for a resolution to give authority to the board for borrowings and investments.

Hyderabad , Feb. 7

DR Reddy's Laboratories Ltd said it is planning to enhance the limit of both borrowings and investments.

The announcement assumes significance as it comes close on the heels of media reports that it has offered euro 450 million (about Rs 2,500 crore) for acquiring a German generic drugs major.

Dr Reddy's Labs has informed the stock exchanges that it proposes to seek the approval of its shareholders through postal ballot for a resolution to give authority to the board for borrowings and investments in excess of the limits prescribed under Section 293 and 372A of the Companies Act, 1956.

The company also proposes to seek shareholders nod for creation of charges on the company's properties and issue of securities for raising the funds.

According to the media reports, the acquisition of Betapharm Arzneimittel GmbH of Germany by Dr Reddy's Labs, if it materialises, would be the biggest overseas acquisition by an Indian pharmaceutical company.

Reports said that other Indian pharmaceuticals majors such as Ranbaxy, Wockhardt and Nicholas Piramal have also submitted bids to acquire Betapharm. Global majors such as Teva and Sandoz have also bid for the German company. The company said it has appointed Mr B. Satya Reddy, practicing company secretary, as scrutiniser for conducting the postal ballot process in a fair and transparent manner.

The postal ballot form duly completed should reach the scrutiniser not later than the close of working hours on March 4.