Sun Pharma Completes Merger with Taro Pharmaceutical Industries in $1.6 Billion Deal

Indian giant Sun Pharma has successfully finalized the merger with Israeli company Taro Pharmaceutical Industries Ltd. After Sun Pharma's proposal to acquire all shares of Taro in May of the previous year, both companies have now officially signed an agreement for the merger.

As of now, Sun Pharma holds approximately 78% of Taro Industries, with the transaction valuing at a substantial $1.6 billion. Initially, the proposed price per Taro share by Sun Pharma was $38, but it was later increased to $43 last month, demonstrating the strategic importance and value placed on this acquisition.

The merger has been conducted through a three-way process, complying with the Israeli Companies Law, 1999. Sun Pharma established a wholly owned subsidiary (SPV), which entered into a merger agreement with Taro. Subsequently, the SPV merged with and into Taro, with Taro surviving the transaction. Consequently, Taro has now become a wholly owned subsidiary of Sun Pharma, leading to its delisting from the New York Stock Exchange.

This move follows a surge in Taro's stock price of 23.1% immediately after the initial acquisition announcement in May. In response to the offer, Taro formed a special committee to assess the proposal, and they have now unanimously agreed to sell the shares.

Sun Pharma's announcement to the stock exchanges emphasized their anticipation that the transaction structure, common in Israel, would prove beneficial to all stakeholders of Taro. The company expressed confidence in the quick and secure execution of the merger, marking a pivotal moment in the evolving landscape of the global pharmaceutical market.