Sun Pharma to acquire remaining 21.52% shares of Taro for Rs 2,891.76 crore

Sun Pharmaceutical Industries Limited said that it will acquire the remaining 21.52% stake in Taro Pharmaceutical Industries.

Sun Pharmaceutical Industries Limited on Thursday said that it will acquire the remaining 21.52 per cent stake in Israel-based Taro Pharmaceutical Industries, which would result in the former acquiring all of the public shares of Taro. The cost of acquisition, the company said, amounted to Rs 2,891.76 crore or $43 per share in cash without interest, amounting to $347.73 million for 8,086,818 shares.

Dilip Shanghvi, Managing Director of Sun Pharma, said, “Over the years, with Sun Pharma’s strategic interventions, Taro has remained a key player in the generic dermatology market in a challenging environment. Post completion of the merger, the combined entity will firmly move forward, leveraging its global strengths and capabilities to better serve the needs of patients and healthcare professionals.”

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Uday Baldota, Chief Executive Officer of Taro, said, “Taro is committed to delivering high quality products to our patients and customers around the world. This merger will further enable us to compete effectively in our products and markets.”

The $43.00 per share purchase price represents a 48 per cent premium over the closing price of $28.97 per share on May 25, 2023, the last trading day before Sun Pharma first submitted its non-binding proposal to Taro, and a premium of 58 per cent to the volume-weighted average price of the shares during the 60 days prior to and including May 25, 2023. The purchase price also represents a 13 per cent increase over the initial proposed purchase price of $38.00 per share as proposed on May 26, 2023.

The merger agreement was unanimously recommended by the Special Committee, which was formed by Taro’s Board of Directors to consider Sun Pharma’s proposal. Following a comprehensive evaluation of the proposal with assistance from independent financial and legal advisors, the Special Committee determined that the merger agreement and the per share merger consideration are fair and in the best interests of Taro and its minority shareholders.

Upon receiving the unanimous recommendation of the Special Committee, and following unanimous approval by Taro’s Audit Committee, Taro’s Board and the Board of Directors of Sun Pharma unanimously approved the definitive merger agreement.