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| Sun threatens to sue Taro directors |
| Press Trust of India / New Delhi Jan 11, 2010, 20:11 IST |
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Sun Pharma today threatened to take legal action against the directors of the Israeli drug firm Taro, which is fighting a takeover battle with the domestic firm, for acting against the interest of its shareholders.
"We will take all necessary legal action to reverse the cynical attempt by the Levitt family to reward you... Again with the funds of Taro, for the actions you have taken at their behest," Sun Pharma Chairman and Managing Director Dilip Shanghvi said in a letter to the Taro directors.
Shanghvi said an overwhelming majority of the public shareholders of Taro want a change in its management control and the composition of the company board.
"It has been apparent... Your real interest in commencing the various litigations on behalf of Taro against Sun was and remains your misplaced and unexplained desire to help only the Levitt family," the letter said.
Sun is locked in a takeover battle with Taro after their $454-million merger deal, signed in 2007, collapsed a year later due to the unilateral termination of the agreement by the Israeli firm.
Following this in June 2008, Sun launched an open offer to acquire the remaining shares of Taro, including those held by its promoters the Levitt family. This forced Taro to drag Sun to the Israeli supreme court, which prohibited Sun from closing the open offer until the resolution of the issue.
The Taro annual general meeting on December 31 to re-elected its existing board besides sought approval of a new indemnification proposal, which gave an undertaking by the company to shareholders to compensate for any possible damages or losses.
These proposals were rejected by the minority shareholders at the AFM, which according to industry experts has paved the way for Sun to get control of Taro.
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