The Mint Report for 08 September 2010

The Mint Report for 08 September 2010

Sun Pharma has won its battle with Taro Pharmaceuticals. The Israeli Supreme Court unanimously dismissed Taro’s appeal in the case between the two companies. The court also withdrew an injunction preventing Sun from closing its offer for Taro. Sun and Taro signed a merger deal back in 2007, but Taro ended it the next year. Sun Pharma has been trying to gain control of Taro ever since. Wednesday’s court decision will allow Sun Pharma to mandate that Taro’s controlling shareholders sell it their stock. Mumbai-based Sun currently owns 36.4% of Israel-based Taro.

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News of the judgment sent stocks of Sun Pharmaceuticals shooting up 3.1% on the BSE during early hours of trade. The stock closed with a more modest gain of 2.05% at 1756.25.

British phone company Vodafone has lost a major tax case with the Indian government. On Wednesday the Bombay High Court ruled in favour of the IT department, saying Vodafone was liable to pay taxes on its 2007 deal to buy Hutchison Essar. Vodafone had paid Hong Kong-based Hutchison Whampoa $11 billion for 67% of the company. The mobile giant had argued it owed no taxes because the deal took place between companies based outside India. But tax authorities say the deal was for assets based inside the country. Wednesday’s judgment makes Vodafone liable for up to $2.6 billion in taxes.

India may have struggled to pass the nuclear liability bill, but America is not pleased. The State Department has said the US government will hold discussions with India on the issue. A spokesman said Indian business leaders were also concerned about some provisions in the bill and that the U S would approach the Indian government about possible changes. Both houses of India’s parliament have approved the nuclear liability bill, but not before making eighteen new amendments. Those changes include tripling the liability cap to Rs1,500 crore and letting victims claim compensation even 20 years after an accident. The nuclear liability bill is crucial for implementing the Indo-US nuclear energy deal.