Dr Reddy's says founders not planning stake sale

BANGALORE, Sept 11 (Reuters) - Dr Reddy's Laboratories Ltd (REDY.BO) said on Friday the founders of the Indian drug maker had no plans to sell their stake in the company, denying media and market talk about a possible deal with a global pharma major.

"The promoters have no intention of diluting their stake in the company and it is purely a market speculation," Dr Reddy's, India's No. 2 generic drug maker, said in a statement.

The Times of India on Friday said possible suitors being talked about as buyers for the founders' stake of about 23 percent included GlaxoSmithKline PLC (GSK.L), Pfizer Inc (PFE.N), Merck & Co Inc (MRK.N) and Sanofi-Aventis (SASY.PA).

The stock had risen as much as 7.5 percent on Thursday to its highest in more than three years, before closing up 3.65 percent at 821.15 rupees

The shares initially extended gains on Friday but then fell. At 0824 GMT, the shares were down 1.6 percent at 808 rupees in a Mumbai market .BSESN that was down 0.15 percent. The DNA newspaper reported, without citing sources, that Glaxo was offering 950 rupees a share to buy a stake either from the promoters or an existing large investor. Officials at Glaxo could not immediately be reached for a comment.

Hyderabad-based Dr Reddy's and local rivals such as Ranbaxy Laboratories (RANB.BO) and Cipla (CIPL.BO) have thrived on booming global demand for generic drugs as nations around the world battle rising healthcare costs.

But the export-driven Indian companies are facing stiff pricing pressure as more drug makers jump into the generics market. Increased scrutiny of manufacturing standards by overseas regulators is also a worry as it could delay new launches. (Reporting by Sumeet Chatterjee; Editing by John Mair)