J B Chemicals and Pharmaceuticals (JBCPL), a Rs.850 crore plus Mumbai based pharma major, has decided to sell its Over The Counter (OTC) business in Russia and CIS to the wholly owned subsidiary of Johnson & Johnson for total consideration of Rs.939 crore. Further, the company is also selling its worldwide rights and registrations of three OTC brands viz., Doktor Mom, Rinza and Fitovit to J&J's subsidiary namely Cilag GmbH International for an additional consideration of Rs.6.07 crore.


The company is selling these businesses as a going concern on a slump sale basis including OTC trademarks, brands, patents, registrations and domain names. The sale will also involve the transfer of the employees. The transaction is conditional upon customary closing conditions including JBCPL's shareholders' approval and the same is likely to close in mid 2011. Bank of America Merrill Lynch is acting as exclusive financial advisor to JBCPL.


Cilag's affiliate, Johnson & Johnson LLC, has also entered into a contract with the company's wholly owned subsidiary situated in Russia for purchase of its OTC inventory and receivables for a consideration of US $ 47 million. JBCPL has signed a long term agreement to supply Cilag finished products for the acquired Russia and CIS OTC business.


J B Mody, chairman of J B Chemicals, said, “The divestment will provide JBCPL with the financial flexibility to pursue new growth opportunities in India and other focus markets. We are confident that J&J will take our business in Russia and CIS to even greater heights.”