Sun Pharma ends deal to take over Israeli unit Taro

Fri Feb 8, 2013 9:50pm IST

Related Topics

Stocks

   

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

Shares Hit Record

Sensex, Nifty rise to second consecutive record high

Sensex surges 500 points on BOJ easing, L&T gains

The BSE Sensex and Nifty surged to record highs for a second consecutive session on Friday after Bank of Japan's surprise expansion of its massive stimulus programme raised hopes for additional foreign inflows, boosting blue-chips such as Larsen & Toubro.  Full Article 

REUTERS SHOWCASE

Wilful Negligence?

Wilful Negligence?

SEBI piles pressure on Sahara to sell overseas hotels  Full Article 

Indian Economy

Indian Economy

India's fiscal deficit in H1 almost 83 pct of full-year target.  Full Article 

M&M Earnings

M&M Earnings

M&M Q2 net profit down 4 percent, hit by poor monsoon.  Full Article 

Ban on E-Cigs?

Ban on E-Cigs?

Govt considers ban on e-cigarettes, sale of single smokes.  Full Article 

Commodities

Commodities

Silver futures in India hit four-year low on global cues.  Full Article 

BOJ Policy

BOJ Policy

BOJ shocks markets with surprise easing as inflation slows.  Full Article 

Shadow Banking

Shadow Banking

China's shadow banking sector growing rapidly, third largest in world - FSB.  Full Article 

Reuters India Mobile

Reuters India Mobile

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