India's Sun Pharma buys Israel's Taro for 454 million dollars

May 21, 2007, 6:55 GMT

New Delhi - India's Sun Pharmaceutical Industries Ltd has signed agreements to acquire Israel's Taro Pharmaceutical Industries Ltd in a 454-million-dollar deal, Sun said in a notice Monday to the Bombay Stock Exchange.

This is the first investment in Israel by a multinational pharmaceutical company based in India.

The Indian drugmaker, which signed the deal over the weekend, informed the exchange that it would acquire Taro shares for 7.75 dollars in cash, a 27-per-cent premium over its Friday closing price, representing a transaction with total equity value of 230 million dollars. Sun also agreed to refinance about 224 million dollars of Taro's debt.

'We intend to build on Taro's expertise in dermatology and paediatrics along with specialty and generic pharmaceuticals, and over-the-counter products,' Sun chairman and managing director Dilip Shanghvi said.

'With the addition of 170 talented scientists to our team, we look forward to an increasing number of product filings of higher complexity,' he added.

The two companies also entered into a separate agreement for Sun to provide 45 million of interim equity financing to Taro by acquiring 7.5 million of its ordinary shares.

Established in 1983, Sun employs 550 scientists and manufactures and markets pharmaceuticals in India, the United States and several other markets across the world. Based on the latest closing price on the Indian stock exchanges, Sun's market value is 5 billion dollars.

Taro has research, manufacturing, distribution and marketing operations in the United States, Canada, Israel and Ireland. It produces more than 180 pharmaceutical products, including topical preparations, oral medications and sterile products.