Dr Reddy’s invests Rs 734 crore in JV with Nestle India, ET HealthWorld

Hyderabad: Pharma biggie Dr Reddy’s Laboratories has injected a little over Rs 734 crore in Dr Reddy’s and Nestle Health Science Limited, its newly incorporated joint venture company with Nestle India for a 51% stake.

On the other hand, the FMCG giant has invested Rs 705.6 crore for a 49% stake in the Hyderabad headquartered JV with a paid-up share capital of around Rs 1440 crore with 144 crore equity shares of Rs 10 each.

The funds being infused towards subscription amount of the JV will be utilized by the newly formed company to acquire nutritional health solutions business or other resources from Dr Reddy’s and Nestle India, Dr Reddy’s Laboratories said in a regulatory filing.

The JV aims to leverage the capabilities and services of the Nestle Group and Dr Reddy’s to focus on the health and wellbeing space by combining their strengths and growing their complementary nutraceuticals portfolios in the metabolic, hospitals nutrition, healthy ageing, general wellness, women’s health and child nutrition in the India and Nepal markets.

Dr Reddy’s said that as part of the agreement the JV company has already paid an upfront amount of Rs 821.7 crore for licencing Rebalanz, Celevida, Antoxid, Kidrich-D3, Becozinc in the nutrition and OTC segments from Dr Reddy’s.

Once the JV commences sale of these licenced products, Dr Reddy’s will also get royalty payments from the JV company.

Nestle will be licencing brands such as Nature’s Bounty, Osteo Bi-Flex, Ester-C, Resource High Protein, Optifast, Resource Diabetic, Peptamen, Resource Renal and Resource Dialysis to the JV.