Taro mulls next move after dismissal of US suit against Sun Pharma
17 Jul 2010
Israel's drug major Taro Pharmaceutical Industries Ltd is now mulling its next move after the dismissal of its lawsuit against Mumbai-based Sun Pharma's efforts to enforce the agreed merger between the two companies.
On Thursday a US district court dismissed a complaint filed by Taro which sought to block an attempt by Mumbai-based Sun Pharma to acquire outstanding shares of Taro through an open tender offer.
Sun Pharma is the single-largest shareholder in Taro with an over 35 per cent stake. It has been trying to wrest control of Taro for the last three years, since their $454-million merger deal in 2007 was unilaterally terminated by the Israeli firm a year later, citing undervaluation.
Following that, both the companies filed cases against each other and the matter lay pending in the Israeli Supreme Court.
Sun Pharma's subsidiary, Alkaloida Chemical, had made an open offer in 2008 for acquiring additional shares of Taro. This prompted Taro to file a case against the Indian firm in a US district court to block the open offer.
The US court rejected Taro's claims that Sun failed to make adequate disclosures concerning the tender offer and dismissed the claims on breach of contract,
misappropriation of trade secrets and lack of subject matter jurisdiction. It has given Taro two weeks to file an amended complaint to fix the defects in the current one.