India’s Sun Pharma to buy Israel’s Taro

MUMBAI - Indian drugmaker Sun Pharmaceutical announced plans on Monday to buy Israel’s Taro Pharmaceutical for 454 million dollars to seek synergies in specialty drugs but minority shareholders want the deal halted.

By (AFP)

Published: Mon 21 May 2007, 7:35 PM

Last updated: Sat 4 Apr 2015, 11:08 PM

The all-cash deal has been challenged by Franklin Advisers and Templeton Assets Management, which own a combined nine percent stake in Taro, on grounds it could hurt minority shareholders, Sun told the Mumbai stock exchange in a statement.

“Sun Pharma believes the proceedings initiated by Franklin Advisers and Templeton are without merit and detrimental to the best interests of shareholders and Taro,” the statement said.

The minority shareholders have filed a case in the Israeli capital Tel-Aviv, seeking a stay on the deal, the statement said.

Sun makes specialty drugs while Taro, which makes over 90 percent of its sales in North America, has a strong franchise in dermatology and topical products.

“We intend to build on Taro’s expertise in dermatology and pediatrics along with specialty and generic pharmaceuticals and over-the-counter products,” Sun Pharma chairman Dilip Shanghvi said.

Sun will fund the all-cash deal through internal accruals and money from a previous convertible bond offering, the company said.

“This is all-cash deal, subject to regulatory clearances,” Sun said.

Taro’s equity is valued at 230 million dollars or 7.7 dollar per share, a 27 percent premium to its Friday’s close of 6.1 dollars, while its debt totals 224 million dollars.

Sun’s shares rose 37.3 rupees or 3.69 percent to 1,050 after the announcement, outpacing the broader market.

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