Sun Pharma denies insider trading charges in Ranbaxy deal
New Delhi: Sun Pharma Wednesday denied insider trading charges against Silverstreet Developers LLP - its wholly owned arm - in the USD 4 billion acquisition deal of Ranbaxy Laboratories.
Silverstreet Developers LLP, which had no holding in Ranbaxy at the end of September 2013, had bought shares of the Gurgaon-based firm aggregating 1.41 percent stake by end of December 2013. As on March 31, 2014, its holding stood at 1.64 percent.
In a statement, Sun Pharma said the matter related to purchase of shares of Ranbaxy Laboratories Ltd by Silverstreet Developers LLP "does not violate insider trading rules".
It has been reported that Sudhir V Valia, brother-in-law of Sun Pharma Managing Director Dilip Shanghvi, was one of the partners of Silverstreet Developers LLP.
Sun Pharma, however denied this.
"Sudhir Valia is not and was not a partner of Silverstreet Developers LLP when purchase of shares of Ranbaxy Laboratories Ltd was affected by LLP," the company said.
Explaining how it has not violated insider trading rules, Sun further said: "Silverstreet Developers LLP has two partners. Both are 100 percent subsidiaries of Sun Pharma. Hence, all the benefits flowing from the investment in Ranbaxy shall accrue to Sun Pharma."
The Mumbai-based firm, had on Monday announced it will fully acquire Ranbaxy in an all stock transaction with a total equity value of USD 3.2 billion, along with debt of USD 800 million taking the overall deal value to USD 4 billion.
The combination of Sun Pharma and Ranbaxy creates the fifth-largest specialty generics company in the world and the largest pharmaceutical company in India.
Sun Pharma shares today closed at Rs 627.80 a piece on the BSE, up 6.91 percent from its previous close.