Pharmaceutical major Ranbaxy Laboratories [Get Quote], which has been linked to a hostile takeover bid of Chennai-based Orchid Chemicals, on Wednesday said the company does not believe in such practices.

"As a company, we do not believe in hostile takeovers," a company spokesperson said.

Solrex Pharma, reportedly a Ranbaxy promoter group firm, had acquired over 8 per cent stake in Orchid Chemicals through open market purchases.  The Ranbaxy official also declined to confirm or deny if Solrex Pharma is a part of the Ranbaxy Group.

On Tuesday, a top Orchid Chemical official confirmed to PTI that Ranbaxy has acquired further stake in the company, but declined to give further details or on whether any meeting was held between the two companies.

"Ranbaxy has acquired around five per cent stake in the company (but) we are not going to comment on anything that has been speculated about the acquisition of the company," Kailasam Raghvendra Rao, managing director, Orchid Chemicals & Pharmaceuticals said.

Orchid's shares traded at Rs 220.7 in the afternoon on Wednesday, down by 8 per cent on the Bombay Stock Exchange. Meanwhile, Ranbaxy shares also down by 8.6 per cent at Rs 462.15.