Electronics manufacturer Videocon is set to acquire India-based pharmaceutical company Dr Datsons Labs (DTL) in a deal that would value Datsons at Rs 3.5bn ($58m), Business Standard has reported citing an undisclosed source.
Business Standard claimed that Videocon had written to the Bank of Baroda asking for an extra line of credit to fund the acquisition. Videocon, through its subsidiaries, reportedly increased its holding in Dr Datsons from 9% to 19% in the first quarter of 2014.
Videocon has since denied claims it intends to acquire the company. Moneycontrol.com published a quote from Videocon stating: “We hereby completely deny the news that Videocon is set to acquire Datsons Labs.”
Datsons has however been on the lookout for investors, according to vice chairman Kannan Vishwanath, who said: “We are in talks with a couple of merchant bankers for a possible sale. At the same time, we are also evaluating other options, including investments into the company, to meet our proposed capital expenditure plan for expansion projects.
“By next week, we will be finalising the name of the merchant banker for a possible stake sale.”