IPO-bound Allchem in legal tussle with Alkem over trademark infringement

IPO-bound Allchem Lifesciences adds legal dispute with Alkem to DRHP as Delhi HC directs both firms to mediation and next hearing is scheduled for 9 July

Vadodara-based Allchem Lifesciences on Friday issued an addendum to its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi), highlighting a suit filed by Alkem Laboratories against it in the Delhi High Court.

 

The suit, filed on 23 April, alleges infringement of Alkem Labs’ trademark with respect to the use of the name Allchem by the initial public offering (IPO)-bound company.

 

In its submission to the Delhi HC, Alkem has sought a permanent injunction on the use of the name “Allchem” and the offer under this name, along with damages of ₹2 crore for the alleged loss of goodwill and reputation.

 

The addendum adds that in all future communications related to the public offer, Allchem will carry a disclaimer that it is not associated with Alkem in any manner. 

 

According to Sebi regulations, any IPO-bound company is required to share addendums in the risk factors section of its DRHP, addressing changes and updates that occur after the initial filing with the markets regulator.

 

The addendum also stated that the court had passed an order on 24 April directing both parties to the Delhi High Court Mediation and Conciliation Centre. Both Alkem and Allchem have participated in the mediation on various dates, with the latest one being on 11 June.

 

The next hearing for the case is scheduled for 9 July.

 

Industry insiders believe the suit may cast a shadow over Allchem’s IPO plans, stalling Sebi’s final approval until a verdict is reached.

 

Both Allchem and Alkem did not wish to respond to queries from Business Standard till the time of going to print citing the sub judice nature of the matter.  

Allchem had filed preliminary papers with Sebi in March this year, seeking approval to raise funds through a proposed IPO comprising a fresh issue of equity shares aggregating up to ₹190 crore and an offer for sale (OFS) of 71.55 lakh equity shares by promoters.