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CORRECTED-Serbia seeks bids for majority stake in troubled drugmaker
September 1, 2017 / 8:52 AM / 3 months ago

CORRECTED-Serbia seeks bids for majority stake in troubled drugmaker

(Corrects to remove Reuters Instrument Code FITO.BEL in first paragraph. Clarifies that Galenika AD is unlisted)

BELGRADE, Sept 1 (Reuters) - The Serbian government sought bids for a majority stake in indebted drugmaker Galenika AD after increasing its control in the unlisted company through a debt-for-equity swap last month.

The government has been trying to sell Galenika as part of efforts to privatise, shut or slim down unprofitable state firms under its 1.2 billion euro ($1.4 billion) loan deal with the International Monetary Fund, but the generic drugmaker’ s heavy debts have discouraged investors.

In a tender published in a Serbian daily, the government is offering its entire 93-percent stake for sale. The starting price is a nominal one euro, but the new owner will have to repay 25 million euros of company debt. Potential bidders will have until Oct. 2 to express their interest in buying a majority stake in Galenika, the tender said.

Last month, the government and state-run gas retailer Srbijagas took on a combined 14.7 billion dinars ($147 million) of Galenika’s debt in exchange for an 8 percent stake, increasing their total share in the drugmaker to 93 percent. .

The remaining seven percent of the shares belong to small shareholders.

The government tried to privatise Galenika in 2013 but the sole bidder, Canada’s Valeant, pulled out, citing the hostility of local unions as one factor.

In February this year, Serbia failed to reach a deal with a group of foreign drugmakers on the sale of a 25 percent stake in Galenika. ($1 = 0.8410 euros) ($1 = 100.0800 Serbian dinars) (Reporting by Aleksandar Vasovic; Additional reporting by Ivana Sekularac; Editing by Keith Weir)

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