Andhra Pradesh High Court on April 25 had directed the BSE and NSE not to approve the merger while admitting a petition by retail investors alleging insider trading in the $4-billion deal. The two retail investors Tammali Shiva Kumar and Undi Venkatasubbaraju alleged that Silver Street, a limited-liability partnership firm owned by two subsidiaries of Sun Pharma, was involved in the insider trading of Ranbaxy shares.
The vacation bench comprising of Justices B S Chouhan and A K Sikri on Wednesday directed the High Court to decide on Sun Pharma's application seeking vacation of the the status quo order within two days.
The Supreme Court also posted the matter for further hearing on May 29.
The judges also observed that the Andhra High Court has no territorial jurisdiction over the merger process.
Stating that any delay in the merger would hurt Ranbaxy's 182,721 and its 139,546 shareholders, Sun Pharma in its petition before the apex court had said the allegation of insider trading was based on mere surmises, conjectures and assumptions.
Questioning the jurisdiction of the AP HC to entertain the petition as the registered offices of none of the firms are located in Hyderabad, Sun Pharma said allegations of insider trading can be investigated independently by Sebi and there was no bar in initiating such investigation even if the scheme of arrangement would have been approved.
Sun Pharma had announced on April 6 that it would fully acquire Ranbaxy in an all stock transaction with a total equity value of $3.2 billion, along with debt of $800 million taking the overall deal value to $4 billion.