Sources inform ''Globes'' that India's Sun Pharmaceuticals Industries Ltd. (BSE: 524715) may be willing to pay an additional several tens of million dollars to take over Taro Pharmaceutical Industries Ltd. (Pink Sheets: TAROF). The companies are now in advanced negotiations to close a deal at a new price.
Last Thursday, "Globes" disclosed that the main protagonists, Taro chairman Dr. Barrie Levitt and Sun Pharmaceuticals chairman and CEO Dilip Shanghvi, came specially to Israel for a meeting arranged by Adv. Ram Caspi at his offices. Also present was a senior representative of Franklin Resources Inc. (usually referred to as Franklin Templeton) (NYSE: BEN), which owns 13.1% of Taro, and which previously strongly opposed the takeover.
Sources close to the talks told "Globes" today that "substantial progress" was achieved at the meeting, and that the companies' representatives were now working on tying up loose ends to close a deal.
The price in the present talks is closer to Sun Pharmaceuticals' revised offer than to Taro's. Under original terms of the deal, Sun was to pay $7.75 per share in cash, and also pay an additional sum toward equity financing. Closing the deal at that original price gives Taro a company value of $305 million, which means that Sun Pharmaceuticals will pay Taro's other shareholders $194 million.
Taro's share closed at $10.60 on Friday.
Both Taro and Sun Pharmaceuticals have been tight lipped and declined to comment on the report.
Published by Globes [online], Israel business news - www.globes-online.com - on February 23, 2009
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