Habil Khorakiwala owned pharma major, Wockhardt, has announced the sale of its animal health business to a French veterinary care company, Vétoquinol, in a bid to arrange funds for repayment of debts worth Rs 3,400 crore. The company reported net sales of Rs 77 crore, for the year ended December 31, 2008, from its animal health business. It suffered huge losses due to foreign currency fluctuations and has to pay foreign currency convertible bonds worth Rs 600 crore by October this year.

The Wockhardt-Vétoquinol deal, worth Rs 170 crore, would come into force from the second half of 2009, subject to consent from the board. France based Vétoquinol, the 11th largest animal company of the world, specializes in animal business; with 80 per cent of its income coming from outside France.

Wockhardt is currently undergoing debt restructuring through a corporate debt restructuring plan, pledging its various assets to meet liabilities. Earlier, it had sold its German subsidiary Esparma to Mova GmbH for Rs 120 crore, to arrange funds to cover foreign currency transaction losses.

The company said: “This initiative to divest its non-core business is a step towards its continued growth plan and a firm focus on its core human pharmaceutical business.”