Kampala. An Indian multinational pharmaceutical company, Cipla, has agreed to buy majority stake of 51% in Quality Chemicals Limited (QCL).
In regulatory filings made to the Bombay Stock Exchange (BSE), India, Cipla said it would pay at least $30m for the stake in the company that imports and distributes human health, animal health and public health products in Uganda.
“The turnover of QCL for the financial year ending Dec 2012, Dec 2013 and Dec 2014 was Shs15.76 billion, Shs17.02 billion and Shs14.85 billion respectively. The transaction is expected to be completed by the end of July 2015, subject to completion of certain conditions precedent,” reads a regulatory filing made by Cipla.
Cipla has already made inroads in the Ugandan market. It is a joint venture partner in Cipla Quality Chemicals Industries (CQCIL), which manufactures therapies for HIV and Malaria. Cipla has also increased its stake in CQCIL to 62.3% from 51%.
In an email response to Daily Monitor, Cipla’s Corporate Affairs department said, “QCL is one of the leading distribution companies for pharmaceutical and consumer products and provides Cipla with a platform to expand its non-tender private market reach in Uganda thereby extending the delivery of its therapies to a much broader set of patients.”
Cipla operates in about 170 countries and has assets valued at about $2bn as of 2013. It was founded in 1935. With this acquisition, Cipla will further extend its footprint in Africa.
“The deal allowed Cipla to gain access to an attractive business platform and further consolidate our position in CQCIL while also providing a liquidity solution for our longstanding Uganda partners,” the email further reads.
Founded in 1997, Quality Chemicals has a number of shareholders. The face of the shareholders is Mr. Emmanuel Katongole, founder of QCL. By press time, Katongole was yet to respond to our request for a comment.