Indian drug major Sun Pharma takes control of Israeli Taro
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Indian drug maker Sun Pharma has bought a controlling stake in Israeli Taro Pharmaceuticals after settling a prolonged legal battle with promoters of the acquired firm.
Sun, along with its subsidiaries, now have increased their economic interest in Taro to 48.7 percent and their voting rights to 65.8 percent, the company said Wednesday in a regulatory filing.
The company did not divulge the cost of the transaction.
Taro has an established franchise in dermatology and topical products in the US, in addition to generic product offerings in cardiovascular, neuro-psychiatric and anti-inflammatory therapeutic categories.
"We intend to build on Taro's market presence in US, Israel and Canada and its expertise in dermatology and pediatrics, along with specialty and generic pharmaceuticals, and over-the counter products," said Dilip Shanghvi, Sun chairman and managing director.
Prior to the acquisition, Sun Pharma had a 36 per cent stake in the Israeli drug firm.
In 2007, Sun Pharma had struck a $454 million merger deal with Taro which was unilaterally terminated by the Israeli firm in 2008. Taro was promoted by the Barrie Levitt family, which has a 12 per cent stake in the firm. Sun has been involved in a legal tussle with Taro ever since.
The Indian pharma company got a favourable ruling from the Israeli Supreme Court in its takeover battle for Taro, following which it had offered to buy 4.8 million shares of the Levitt family, at a price of $7.75 per share, translating into a total consideration of $37 million.
Shanghvi will now be chairman of the Board of Taro.
Taro has factories in Canada and Israel that manufacture topical creams and ointments, liquids, capsules and tablets dosage forms which complements Sun’s current manufacturing and development capabilities for the US.
"We have tangible plans to significantly increase volume of production and approve further investments in Research and Development in Israel and Canada, specially in delivery systems and complex chemistry. With the scientific talent within Taro, we look forward to increasing the number of product filings of higher complexity," Shanghvi added.
The Sun Pharma scrip touched an intra-day high of Rs.1,984.70 in early trade at the Bombay Stock Exchange, up 3.05 percent from its previous close at Rs.1925.90, but slipped later on profit booking.
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