Sun Pharma, Taro end merger pact
“Sun Pharma and Taro (at the direction of the Special Committee) agreed that terminating the merger agreement was in the best interest of the respective companies and shareholders,” Sun Pharma said in a media release.
In August last year, Sun Pharma had said that it would buy all the outstanding shares of Taro not currently held by the former at $ 39.59 a piece, which could have led to a merger of the two companies. The new offer, which would have cost Sun Pharma close to $600 million (around Rs 3,330 crore), was much higher than its non-binding offer of $24.50 a share made to the Taro board in October 2011.
The move came after the October offer was rejected by a special panel of Taro's board, stating it was “inadequate and not in the best interests of Taro's minority shareholders”.
The August offer too, was subject to approvals from minority shareholders, who have been demanding a higher price for their shares.
A recent rally in Taro's share price did not help Sun's cause either. Sun Pharma had paid around $250 million for the 66% stake it owns in Taro.
Sun Pharma and its affiliates collectively own around 66% of the outstanding Taro ordinary shares