Cipla, the third largest pharma company in India with net sales of Rs 5,300 crore plus, has decided to acquire Meditab Specialities Pvt Ltd for a total consideration of Rs 133.35 crore. Meditab has small and mid-sized formulation manufacturing facilities at multiple locations. Entities controlled by the relatives of the promoters are major shareholders in Meditab. The aggregate consideration for this acquisition was determined on the basis of the valuation report provided by Grant Thornton and fairness opinion provided by Kotak Mahindra Capital Company Ltd.

In addition to control over Meditab's aforesaid manufacturing facilities which would result in improvements in operational and cost efficiencies, the company will benefit from Meditab's investments. Meditab is implementing expansion of API/intermediates international business through the manufacturing facility in China and entering into the high growth Chinese domestic formulations market through the local manufacturing facility in China.

Meditab has facility in Uganda which will be additional business opportunity in Africa. Further, it is extending existing strategic relationship for research & development of stem cell based products having facilities in India and Malaysia, through equity participation.

Meanwhile, Cipla management has recommended a special interim dividend of 80 paise per equity share (face value of Rs 2 per share) for the financial year ending March 31, 2011 to commemorate 75th anniversary of the company. The total payout inclusive of dividend tax would aggregate to approximately Rs 75 crore. The record date is fixed on September 6, 2010.