Sun Pharma ends deal to take over Israeli unit Taro

Fri Feb 8, 2013 9:50pm IST

Related Topics

Stocks

   
Kishore Pandey, 82, lies on a bed as his daughter, Usha Tiwari, holds him and a priest stands by them (L) at Mukti Bhavan (Salvation House) in Varanasi, in the northern Indian state of Uttar Pradesh, June 19, 2014. REUTERS/Danish Siddiqui

Waiting to die at Salvation House

The city of Varanasi is Hinduism's holiest city and many Hindus believe that dying there and having their remains scattered in the Ganges allows their soul to escape a cycle of death and rebirth.  Slideshow 

REUTERS - Sun Pharmaceutical Industries Ltd (SUN.NS), which has been on a buying spree, ended its agreement to gain full control over its Israeli unit Taro Pharmaceutical Industries Ltd (TARO.N).

The companies decided that ending the deal was in the best interest of their shareholders, Sun Pharma and Taro said in a statement.

"The decision (to not merge Taro) could prove beneficial for Sun Pharma as long as Taro is generating good cash flow," said Siddhant Khandekar, an analyst at ICICI Direct in Mumbai.

"There might be structural issues while handling Taro, but it won't hurt Sun to a large extent."

Sun Pharma had last offered $39.50 per share, or about $571 million, for the one-third stake it did not already own in Taro, seemingly winning over the Israeli company's board following a long battle to gain full control of the U.S.-listed drugmaker.

Raising the price beyond $39.50 per share did not make any sense for Sun Pharma, Khandekar said.

Sun Pharma, India's biggest drugmaker by market value, remains one of the few Indian pharma companies that has done successful international acquisitions at a time when global pharmaceutical giants such as Abbott Laboratories (ABT.N) and Sanofi SA (SASY.PA) have been buying out Indian drug companies at high valuations.

Sun Pharma bought U.S.-based Dusa Pharmaceuticals Inc DUSA.O for about $230 million and URL Pharma from Japan's Takeda Pharmaceutical Co (4502.T) for an undisclosed amount last year.

Taro shares were up 2 percent at $51.75 in morning trade on the New York Stock Exchange. Sun Pharma shares closed down marginally at 746.10 rupees on Friday on the National Stock Exchange. (Reporting by Esha Dey in Bangalore and Kaustubh Kulkarni in Mumbai; Editing by Roshni Menon)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

India-Nepal Ties

REUTERS SHOWCASE

Tackling Food Prices

Tackling Food Prices

India to free up extra 10 million tonne wheat in open market  Full Article 

Facebook Results

Facebook Results

Facebook beats Wall Street targets, stock hits record high  Full Article 

GM Recall

GM Recall

GM recalls 717,950 vehicles in U.S., not for ignition switches  Full Article 

Hyundai Motor Results

Hyundai Motor Results

Hyundai Motor Q2 profit slips as firmer won, U.S. discounts hurt  Full Article 

Nokia Results

Nokia Results

Nokia raises networks outlook after Q2 profit beats estimates  Full Article 

Factory Sector

Factory Sector

China July HSBC flash PMI at 18-month high of 52.0   Full Article 

Breakingviews

Breakingviews

Apple winds up earnings hope for new gadgets  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage