Mumbai: Initiating a challenge against Israeli generic drug maker Taro Pharmaceutical Industries Ltd’s unilateral decision to terminate a May 2007 merger agreement, Dilip Shanghvi-led Sun Pharmaceutical Industries Ltd on Thursday protested against Taro’s decision to sell off its operations in Ireland to a group of Irish investors.
Sun Pharma, which had signed a merger agreement with Taro a year ago, holds a 34.4% stake in the company.
In a strongly worded letter to Taro on Thursday, Sun Pharma said it will not allow the sale of Taro Pharmaceuticals Ireland Ltd, an Irish subsidiary of Taro, which owns and operates a multi-purpose pharmaceutical manufacturing and research facility. “...it is one of the most important businesses that Sun will inherit by the proposed merger plan and it has repeatedly refused to consent under the merger agreement to the sale of those operations,” Sun’s chairman Shanghvi said in the letter.
“We will now notify any potential buyers of Taro Ireland or its assets of Sun’s objection ... by publishing an advertisement in the Irish press,” said a senior executive from Sun Pharma.
Taro last week informed Sun Pharma of its decision to terminate the 2007 agreement, under which the Indian company would have acquired the Israeli firm for $454 million. The company said the price was too low.
Sun Pharma, in its letter Thursday, said Taro had expressed its clear intention to pursue the sale of its Irish operations after terminating the agreement, which would have required it to seek the Indian firm’s approval of the asset disposal.
The Indian company said it is concerned that the sale process and the agreement Taro reached with the Irish buyers significantly undervalued the business. The facility has the potential to produce substantial revenues for Taro in the future, and any sale now is premature, said Sun Pharma, adding that it had deemed the Irish operation to be a central part of its agreement with Taro.
The acquisition of Taro would have given Sun Pharma a multinational generic manufacturer with established subsidiaries, manufacturing and products across the US, Israel and Canada, the Indian company has said. North America represents more than 90% of Taro’s sales.
Taro also has a strong franchise in dermatology in addition to products in cardiovascular, neuropsychiatric and anti-inflammatory therapeutic categories.
Mahindra seals deal to buy Italian design firm
New Delhi: Mahindra and Mahindra Ltd, the largest maker of tractors and utlility vehicles in India, said on Thursday it has acquired all of Italian two-wheeler designing firm Engines Engineering SpA for an undisclosed amount. However, people familiar with the matter said the deal price was close to Rs70 crore.
This will be Mahindra’s second acquisition of a design company after it acquired all of GR Grafica Ricerca Design Srl, another Italian firm, in March.
“Demand for offshoring of engineering services has been growing rapidly, “ said Hemant Luthra, head of Mahindra’s auto component division in an emailed statement. “Acquiring a design house like Engines Engineering provides us the perfect vehicle to penetrate into markets of Europe, China and Russia. It also gives us the impetus to scale up the business, have access to market and technology along with management skills.”
Engines Engineering has revenues of about $12 million. The company develops, designs and prototypes motorcycles for a range of two-wheeler makers around the world from Ducati SpA to Indian TVS Motor Co Ltd. Staff Writer
Centre lines up Rs6,000 cr cost-saving plan
A day after raising the retail prices of petrol, diesel and cooking gas, the Centre on Thursday unveiled a clutch of measures to curb spending to mitigate the inflationary impact of the hike. Hours after Prime Minister Manmohan Singh wrote to his ministerial colleagues urging austerity within the government, the finance ministry directed other ministries to slash non-Plan expenditure by 10% and to stop holding conferences at five-star hotels, to save an estimated Rs6,000 crore this fiscal.
“The ministry is issuing guidelines which different ministries are expected to follow from this quarter itself and administrative secretaries have to monitor them on a monthly basis,” expenditure secretary Sushma Nath said. “These include a 10% cut in domestic and foreign travel, office expenditure, hospitality, consulting and outsourcing professional services and 5% cut in other expenses barring salaries and stipulated overtime allowances.” Nath said no new scheme would be sanctioned on the Plan expenditure side and the states would not get any further release of funds without utilizing the sanctioned sums.
“It is not only necessary from the resource conservation point of view but also as a moral duty to cut out all wasteful expenditure in our own establishments,” the Prime Minister wrote in his letter.
Meanwhile, heeding Singh and Congress president Sonia Gandhi’s call to slash state levies on petroleum products, the Delhi government said it will absorb 80% of the hike on cooking gas. As a result, cooking gas would cost only Rs10 per cylinder more in Delhi.
The Centre had announced a hike of Rs50 per cylinder, besides Rs5 per litre on petrol and Rs3 on diesel, following the sharp spike in global crude prices.
West Bengal, Tamil Nadu and Bihar announced cuts in sales tax on various fuels. Bharatiya Janata Party chief Rajnath Singh also appealed to the party-ruled states to follow suit. Ashish Sharma and Sangeeta Singh
(Krishnamurthy Ramasubbu contributed to this story).
India more attractive than US, Russia: E&Y
Mumbai: India is the fourth most attractive business destination ahead of the US and Russia, according to global consulting firm Ernst and Young’s fifth annual attractiveness survey.
China tops the list as the most attractive business destination with 47% of the respondents voting for it, followed by Central Europe (42%) and Western Europe (33%), according to a survey of 834 decision-makers. India had 30% of the votes.
About a quarter of those surveyed voted India at the second-most preferred location for relocating projects and said it was one of the top three most innovative countries. Anup Roy
IPO scam: first batch of consent payment in
Mumbai:Capital market regulator Securities and Exchange Board of India, or Sebi, on Thursday received its first batch of consent payment from some persons in a case related to an initial public offering (IPO) scam.
These persons have remitted Rs71,75,000 towards the terms of consent, Sebi said in a statement on its website. “The consent amount includes Rs59,75,000 towards disgorgement of the amount of alleged ill-gotten gains and Rs12,00,000 towards settlement charges,” it said.
Disgorgement essentially means that any ill-gotten gains made should be restored back to the original parties.
These individuals had applied for consent without admission or denial of guilt, Sebi said.
In November 2006, Sebi made a disgorgement against National Securities Depository Ltd (NSDL) and some others for a sum of Rs115 crore for alleged carelessness in opening of demat accounts. Of this, NSDL’s share was Rs45 crore. Anup Roy
PVR Pictures to raise Rs120 cr from PE funds
New Delhi: PVR Pictures Ltd, a subsidiary of multiplex operator PVR Ltd, will divest 40% equity to raise Rs120 crore from two institutional private equity (PE) investors. ICICI Venture Funds Management Co. Pvt. Ltd and JPMorgan Global Special Opportunities Group will each invest Rs60 crore in return for 20% stake in the firm, which has interests in film distribution and production.
“This fund infusion will help us become an important player in the film production business. We had a good run with our first film Taare Zameen Par, and this year we will release six films,” said Ajay Bijli, managing director, PVR Ltd. Staff Writer
Accor-Brigade tie-up for serviced residences
Bangalore: After tying up with real estate developers such as Emaar MGF and Nirmal Lifestyles for budget hotels, global hotel operator Accor Hotels and Resorts has ventured into Bangalore with serviced apartments.
The international hospitality chain has entered a management contract with Bangalore-based real estate developer Brigade Group in a Rs 150 crore venture in the city’s south-east Koramangala area.
“Brigade will develop the 128-room project and Accor, with their experience, is going to operate it,” said M.R. Jaishankar, chairman and managing director of Brigade Group, one of the first to construct serviced aparrments in Bangalore . Jaishankar said there will be more joint ventures between the two companies in both serviced apartments and hotel categories. Madhurima Nandy