Jubilant Organosys gains on overseas acquisition

Jubilant Organosys gained 2.64% to Rs 346 at 11:17 IST on BSE after the company said it has signed an agreement with Draxis Health Inc to acquire all the outstanding common shares of the company.

The stock hit a high of Rs 349 and a low of Rs 342 so far during the day. The stock had a 52-week high of Rs 378 on 17 December 2007 and a 52-week low of Rs 244 on 22 January 2008.

The company’s current equity is Rs 14.61 crore. Face value per share is Rs 1.

The current price of Rs 346 discounts its Q3 December 2007 annualized EPS of Rs 23.62, by a PE multiple of 14.65.

Jubilant Organosys’ net profit rose 41.1% to Rs 85.10 crore on 19.8% growth in net sales to Rs 494.50 crore in Q3 December 2007 over Q3 December 2006.

Jubilant Organosys will acquire Draxis Health through its wholly owned subsidiary company. The total value of this transaction is approximately $255 million. The transaction is expected to close in the second quarter of 2008. Jubilant plans to fund the acquisition through a combination of cash-on-hand and debt.

Draxis Health, through its wholly owned operating subsidiary, Draxis Specialty Pharmaceuticals Inc., provides products in three categories: sterile products, non-sterile products and radio pharmaceuticals.

In December 2007, Jubilant Organosys’ wholly owned subsidiary Jubilant Biosys entered into collaboration with Forest Laboratories Holdings to discover small molecule drug candidates for a novel metabolic disorders target.

Jubilant Organosys manufactures pharma & life science chemicals, performance chemicals and industrial chemicals.