Cipla, a leading drug maker, announced on Wednesday that the company has inked pact with Biopharma SPA for establishing a joint venture (JV) company in Algeria to manufacture and market respiratory products.

The company said, "Cipla (EU), a wholly owned subsidiary of the company has entered into a definitive agreement with Biopharma SPA for establishing a joint venture Company in Algeria."

Earlier on Feb 13, 2015, the company had said, "A binding term sheet has been entered into with the company's existing partner, Biopharm SPA, for establishing a JV company in Algeria."

The JV company will manufacture and market respiratory products facilitating Cipla’s front-end presence in Algeria.

As per the term sheet, Cipla (EU) , will hold a 40% stake in the JV company while the remainder will be held by a Biopharm-led Algerian consortium.

The JV company is expected to make an investment of up to USD 15 million in the construction of a manufacturing facility.

Cipla (EU) initial investment in cash in the JV company is expected to be USD 6 million.

Shares of the company gained Rs 1.1, or 0.16%, to trade at Rs 681.25. The total volume of shares traded was 60,530 at the BSE (10.45 a.m., Thursday).