Guardian Point asks Sun Pharma to up Taro Pharma offer

MUMBAI: Guardian Point Capital, one of the minority shareholders of Israeli firm Taro Pharma, has asked Sun Pharma to revise $24.50 share price offered by the company to buy out Taro's minority shareholders.

Since its acquisition of Taro, Sun Pharma has been under pressure from minority shareholders to raise the offer price. Last year it proposed to acquire Taro's remaining shares by offering $24.50 per share. But minority shareholders are demanding more as Taro's performance has improved. Sun owns 66% of Taro.

"We believed that you would behave in a manner consistent with your past: shrewd, but not sinister, and in a self-interested way that preserves both your hard fought reputation for fairness and the Sun Pharmaceuticals brand as the preferred partner of choice," said Tim Davis, managing partner, Guardian Point Capital

Sun Pharma refused to comment on this issue. Taro's shares are trading at $35.74 at the NYSE.

In April this year, two of Taro's minority shareholders, Raging Capital and Grand Slam Asset management have demanded that Taro reject Sun Pharma's offer price. In its letter to the board, Raging Capital accused Sun of grossly undervaluing the company by valuing Taro at 7 % of its enterprise value. Raging Capital in that letter had said Taro share is worth $ 106.91. Another minority shareholder Grand Slam Asset Management had demanded price of $48 per share.

In 2007, Sun Pharma offered to buy Taro Pharma for $450 million, but it only obtained management control last year after a bitter legal battle with Taro's former promoters. Sun Pharma shares closed at 626 on Wednesday down by 0.31%.