Sun Pharmaceutical Industries has been hit by allegations of failing to disclose the ownership of additional shares in its subsidiary Taro. According to regulatory filings, as of March 31, 2021, Sun Pharma and its affiliates owned 77.8 per cent of Taro’s outstanding ordinary shares.
A compliant has reportedly been filed at the US Securities and Exchange Commission (SEC) alleging that Sun Pharma did not disclose the ownership of additional 3.8-4 million shares. According to a report, the complainant alleged that the company used these undisclosed shares to influence the outcome of an extraordinary general meeting that was held in 2013 in which an activist investor tried to block resolutions and elect its nominee directors.
Sun Pharma has denied these fresh allegations. The company said it has neither got any notices nor has any independent information of compliant filed with the SEC. The company added that it does not own any shares in Taro other than what is disclosed and that no attempt was made to influence voting at Taro EGM.
It was in 2010 that the country’s largest pharma company had acquired a controlling stake in Taro Pharma, after a legal battle.
Shares of Sun Pharma on Tuesday ended at Rs 814.60-marking a gain of 0.35 per cent over the previous close.
Meanwhile, the company reported a nearly 13 per cent rise in consolidated net profit to Rs 2,047 crore for the period ended September 30, 2021.Consolidated revenues stood at Rs 9,625 crore against Rs 8,553.13 crore a year ago.
In May 18, 2007, Taro and Sun Pharma's subsidiaries entered into a merger agreement whereby Sun Pharma's subsidiary would acquire Taro which the latter’s board of directors unanimously approved. However, in 2008, Taro terminated the proposed merger agreement.
Following that, Sun Pharma had filed an action in the Supreme Court of the State of New York against Taro and its board of directors.
Shares of Sun Pharma on Tuesday ended at Rs 814.60-marking a gain of 0.35 per cent over the previous close. Meanwhile, the company reported a nearly 13 per cent rise in consolidated net profit to Rs 2,047 crore for the period ended September 30, 2021.
