3 June 2019: Three privately held pharmaceutical companies — Accord Life Spec, Dhanuka Laboratories and Covalent Laboratories — have shown interest and submitted a resolution plan to take over the beleaguered Orchid Pharma, which is under corporate insolvency process. The winning bidder may be announced later this week.
The resolution professional (RP) appointed by the National Company Law Tribunal (NCLT) had called for a second round of bids after Ingen Capital’s bid was rejected due to failure to produce the promised money up front.
In a regulatory filing, Orchid Pharma said, “The RP and the bid process adviser presented the terms of the resolution plans received and found to be compliant under sec 29A to the committee of creditors (CoC). The CoC, after considering the resolution plans received and after negotiating with the three resolution applicants, has decided to declare the H1 (highest) bidder on May 30, 2019.
The RP will be submitting the resolution plan of the H1 bidder to the adjudicating authority if the same receives approval of the CoC with 66% voting share.” One source said that Accord may be the winner. Chennai-based Accord is promoted by former Union minister and DMK MP S Jagathrakshakan. While Covalent makes APIs (active pharmaceutical ingredients — the materials that are used to make drugs), Dhanuka is a manufacturer and exporter of oral Cephalosporin APIs, similar to the product lines of Orchid. “The key is the valuation. We understand that it could be significantly lower than what Ingen offered,” a source said. Ingen eyed Orchid with a bid for Rs 1,490 crore, but the transaction was annulled when they failed to shore up the funds.