The Board of Matrix Laboratories Ltd, a bulk drug manufacturing company in Hyderabad, has approved the merger of Vorin Laboratories Ltd and Medicorp Technologies India Ltd with Matrix Laboratories. The Boards of Vorin and Medicorp also approved the proposal to merge their companies with Matrix. The merger, subject to statutory approvals, would be with retrospective effect from April 1 this year.

N Prasad, Managing Director of Matrix Laboratories, said his company would issue two Matrix equity shares of Rs 10 each for 13 equity shares of Rs 10 each held in Vorin and Medicorp. The swap ratio had been worked out by S B Billimoria and Co., an accounting firm in Hyderabad, and N M Raji & Co., a Mumbai-based accounting firm. The merged entity is estimated to have a capital base of Rs 300 crore and a product range which includes bulk drugs, active pharmaceutical ingredients (APIs) and formulations.

The leading pharmaceutical company in the country, Ranbaxy Laboratories, holds 51% stake in Vorin, while the Chennai-based Shriram group has 41% stake in Medicorp. ICICI Bank Ltd and two of its private equity funds had about 45% stake in Medicorp. Matrix offered to buy 21% and 31% stakes from the Shriram group and ICICI Bank respectively, in May this year. Subsequently, Matrix announced an open offer for another 20% stake from Medicorp shareholders at Rs 23 per equity share.

The Rs 102-crore Matrix produces anti-AIDS drugs, anti-depressants, anti-bacterials, and anti-histamines. The Rs 42-crore Medicorp has a US FDA approved facility for Acyclovir and its product range includes anti-virals, anti-fungals, anti-ulcers and cardiac drugs. The Rs 168-crore Vorin has a strong presence in products such as ciprofloxacin, enrofloxacin and anti-AIDS drugs.

Matrix Laboratories posted a net profit of Rs 20.2 crore on net sales of 48.92 crore in the first quarter of 2002-03. Vorin Laboratories posted a net loss of Rs 3.1 crore on net sales of Rs 19.5 crore in the first quarter of 2002-03. However, it recorded a net profit of Rs 1.31 crore on net sales of Rs 157.8 crore during January-December 2001.

Medicorp Technologies posted a net loss of Rs 6.38 crore in 2001-02 on net sales of Rs 40.65 crore.