OREANDA-NEWS. June 15, 2012. Pharmstandard (LSE: PHST LI, MICEX-RTS: PHST RU) has approved a possible purchase of ordinary shares of OJSC Pharmstandard by its subsidiary OJSC Pharmstandard-Leksredstva in the amount of up to RUR 1.1 billion.

OJSC Pharmstandard is the sole (100%) shareholder of its subsidiary OJSC Pharmstandard-Leksredstva. The purchase of ordinary shares of OJSC Pharmstandard may be executed by the subsidiary at market price, in the amount of up to RUR 1.1 billion, during a 12 month period starting from the time of approval. OJSC Pharmstandard has also indicated in the approval that OJSC Pharmstandard-Leksredstva has no intention to purchase the shares in the form of Global Depositary Receipts, GDR circulating at the London Stock Exchange, LSE.

The purchase of ordinary shares reflects the confidence of the management in the fundamental value of OJSC Pharmstandard’s ordinary shares and serves as an encouragement to the shareholders. In future, the purchased shares may be used by the group of companies Pharmstandard in merger and acquisition deals in line with the general development strategy of the group of companies Pharmstandard.

The use of available cash for the purchase of ordinary shares of OJSC Pharmstandard means that the following will not be affected: OJSC Pharmstandard’s planned investment and objectives with respect to the development of its production facilities in compliance with the European Good Manufacturing Practice standards (EU GMP), as well as acquisitions with the view to expanding the company’s products portfolio.

It is worth noting that in the past the group of companies Pharmstandard has had an experience of conducting similar financial operations. In February 2011, OJSC Pharmstandard-Leksredstva purchased 1,824 thousand of ordinary shares of OJSC Pharmstandard for the amount of RUR 5,474 million.