The deal was announced in July 2016. The transaction has been awaiting the Indian government's approval for the past several months.
Chinese drugmakers like Fosun Pharma have been aggressively seeking deals that will help them access the U.S., the world's biggest pharmaceutical market. The takeover bid is said to be biggest-ever Chinese acquisition in in India.
Reports citing the Chinese firm said the deal has already been cleared by the Competition Commission of India (CCI) and the now-defunct Foreign Investment Promotion Board (FIPB), but it needed to be approved by the Cabinet Committee on Economic Affairs. Representatives for Gland Pharma and KKR didn't immediately respond to requests for comment.
Gland Pharma reportedly excels in injectibles and China lacks expertise in that area, the report claimed, hence putting India at advantage. Jagdish Thakkar, a spokesman in the Indian Prime Minister's Office, didn't return phone calls, while an email sent to Cabinet Secretary Pradeep Kumar Sinha wasn't answered.
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Gland Pharma, which was founded by PVN Raju in 1978, develops and makes generic injectables primarily for the United States market as well as for India and some semi-regulated markets. India's trade with China was at $72.3 billion past year, with Chinese exports accounting for 84 percent of the volume.
The current stand-off on a plateau next to the mountainous Indian state of Sikkim, which borders China, has ratcheted up tension between the neighbours, who share a 3,500-km (2,175-mile) frontier, large parts of which are disputed. The setback highlights the difficulties faced by China's once-prolific acquirers, which are facing mounting pressure at home and overseas. HNA Group Co recently scrapped the purchase of an in-flight entertainment provider, while Dalian Wanda Group Co. agreed to sell most of its theme-park assets amid scrutiny from regulators.
A Fosun spokeswoman told us "The acquisition obtained prior approval from relevant PRC authorities, and is pending review and approval from the Cabinet Committee on Economic Affairs of India".
"In addition, the acquisition was reviewed by the FIPB, which has been recommended to the CCEA for further review", it said adding that the termination date has been extended to 26 September 2017. The ostensible reason behind holding back the approval is the modern injectable technology that the Hyderabad-based Gland Pharma has, which the government is wary of falling into foreign hands. It has manufacturing facilities and R&D centres at Dundigal and Bollarum in the city.