If the controlling shareholders of Taro Pharmaceutical Industries Ltd. (Pink Sheets: TAROF) had hoped to harness Haifa Mayor Yona Yahav in their battle against the takeover bid by India's Sun Pharmaceutical Industries Ltd. (BSE: 524715), they were doomed to disappointment. After Sun Pharmaceuticals chairman and CEO Dilip Shanghvi wrote to Yahav, to pledge his commitment to Taro and employees in Israel following a takeover, Yahav withdrew his intervention in the affair.
Yahav had earlier sent a letter to Minister of Industry, Trade and Labor Eli Yishai claiming that if Sun Pharmaceuticals acquired Taro, it would close the company's Haifa plant and fire its 650 employees.
Today Yahav said, "In view of the strong commitment made by the heads of Sun Pharmaceuticals, I have no doubt that a successful factory can be operated here, which will consolidate Haifa's standing as a center for more international corporations that will invest here."
Shanghvi reiterated that he plans to use all of the existing Taro facilities to the maximum and to increase investment in R&D in Israel. “We believe that the current management of Taro is significantly underutilizing its facilities and has considerably reduced its investment in R&D, which is so vital for the future of a pharma company. Sun Pharma will reverse this," he wrote.
"We will work towards clarifying to the Mayor our position in this regard and to communicate that we want to leverage an existing investment of more than $200 million in infrastructure and knowledge in Israel to make Taro into a truly great company.”
Published by Globes [online], Israel business news - www.globes-online.com - on July 30, 2008
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