LAHORE, Oct 19 (Focus Pakistan) - The Citi Pharma Pakheim acquisition has cleared its competition hurdle, putting the Lahore-based API maker on course to own all of Pakheim International Pharma. Neither the company’s May announcement nor its latest disclosure states what it will pay.
A share purchase agreement signed on May 6 sets the terms. Legal, regulatory and other paperwork still stands between the two sides and a closing.
THE MISSING NUMBER
When Citi Pharma’s board approved the purchase in May, the company said the consideration remained subject to formal approval from the authorities concerned. The October disclosure also gives no figure.
Citi Pharma plans to fund the purchase with internal cash and bank facilities. Reports of the May filing said the company expects to complete payments by Dec. 31, 2026, and put Pakheim’s annual revenue at about 500 million rupees. That would equal roughly 3.6% of Citi Pharma’s FY26 sales.
Citi Pharma built its business on active pharmaceutical ingredients (APIs), the chemical compounds that drug companies turn into tablets and syrups. Its customers have included GlaxoSmithKline, Searle, Barrett Hodgson and Martin Dow, and the company calls itself Pakistan’s largest API manufacturer.
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Pakheim runs a manufacturing facility and holds multiple products registered with the Drug Regulatory Authority of Pakistan. The acquisition could give Citi Pharma access to an established manufacturing facility and existing registered products, subject to applicable regulatory requirements. Reports of the May filing said Pakheim will source its APIs directly from Citi Pharma, keeping more of the margin inside the group.
The deal fits a pattern. Since 2024 Citi Pharma has formed ETACI Limited, a 65:35 API joint venture with China’s Hangzhou Newsea Technology. It has also signed a joint venture in Saudi Arabia, partnered with Indonesia’s Mersi Farma, begun nutraceutical exports to the United States, and set up a REIT management company and a veterinary subsidiary.
PROFITS UNDER PRESSURE
The expansion comes as financing costs eat into earnings. Citi Pharma’s consolidated net profit fell 11% to 790.33 million rupees in the year to June 30, even as sales rose 7% to 14.08 billion rupees. Gross profit climbed 23% to 2.47 billion rupees, but higher marketing, operating and financing expenses outweighed that improvement and pushed net profit down. Earnings per share slipped to 3.46 rupees from 3.90.
Adding bank debt for Pakheim will test that balance. Pakheim’s reported revenue represents a relatively small addition to Citi Pharma’s existing business, but the undisclosed purchase price makes the acquisition’s financial risk difficult to assess. The deal will also shift Citi Pharma’s revenue only modestly unless the API supply link lifts margins at the acquired plant.
The CCP has cleared the takeover, but investors still lack the price tag. Until Citi Pharma discloses the final consideration and completes the transaction, the financial cost of its expansion into finished medicines will remain an open question.
