Minority shareholders approval not needed for Sun deal: Ranbaxy Laboratories

Written by PTI | New Delhi | Updated: May 10 2014, 02:43am hrs
Drug major Ranbaxy Laboratories Ltd today said it does not require approval from minority shareholders to go ahead with merger deal with Sun Pharmaceutical.

"According to our understanding, this transaction requires 75 per cent approval of all shareholders. We are proceeding on the deal," Ranbaxy Laboratories CEO and Managing Director Arun Sawhney told analysts in post-earnings call.

Sawhney was responding to question whether approval of minority shareholders is required for the merger. When asked if there were other suitors to acquire the company, he replied in negative and said Sun Pharmaceuticals Industries approached Daichii Sankyo.

On April 7, Sun Pharmaceutical announced it will fully acquire the troubled Ranbaxy Laboratories in an all-stock transaction with a total equity value of USD 3.2 billion.

Under the agreement, Ranbaxy shareholders will receive 0.8 share of Sun Pharma for each share of Ranbaxy.

The combination of Sun Pharma and Ranbaxy will create the fifth-largest specialty generics company in the world and the largest pharmaceutical company in India.

The US drug regulator has banned imports of drugs into that country from all four Indian plants of Ranbaxy for alleged violations of manufacturing norms.

In 2013, the company agreed to pay USD 500 million fine after pleading guilty to felony charges over manufacturing and distribution of adulterated drugs in the US.