New Delhi: Sun Pharmaceutical Industries Ltd said an Israeli court rejected Taro Pharmaceutical Industries Ltd’s bid to delay a takeover of the company by Sun Pharma.
In favour: The ruling by the Tel Aviv court allows Sun Pharma to take a controlling stake in Israel-based Taro Pharmaceuticals. Photograph: Abhijit Bhatlekar
The ruling by the Tel Aviv court allows Sun to take a controlling stake in Taro, the Indian drug maker said in an emailed release on Wednesday.
Tel Aviv-based Taro had sought a court order blocking Sun’s attempt to enforce a 2007 share-purchase agreement that would require Taro’s controlling shareholders, including chairman Barrie Levitt, to sell their shares to Sun for diseases affecting the heart and nervous system. The ruling will help accelerate Sun’s plan to expand its presence in the US, the world’s biggest drug market.
The “Tel Aviv Court’s ruling that Sun need not make a special tender offer for Taro paves the way for an early closure of Sun’s efforts to acquire Taro,” Prashant Nair, a Mumbai-based analyst at Citigroup Inc., said in a note to clients. Sun already owns about 40% of the ordinary shares of Taro, representing about 23% of voting rights, JPMorgan Chase and Co said in a note in June.
That will rise to 68% of the voting rights if Sun purchases the remaining stake of the founders, the note said.
Sun Pharmaceutical in May 2007 offered to buy Taro for $230 million (Rs1,005 crore) in cash and an additional $224 million to refinance debt.
Under the agreement, Sun has the right to buy all Taro shares owned or controlled by the Levitt and Moros families at $7.75 per share and offer to buy the remaining stock at the same price.