• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• Smartbuy

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Our Bureau

Mumbai, July 31 The much-talked about Daiichi Sankyo open offer for acquiring additional 20 per cent stake in Ranbaxy Laboratories has been extended, pending approval from SEBI which is expected early next week.

“The clarifications required were submitted and the approval is likely to come early next week,” said merchant banking sources, adding “the open offer has been extended.” The extended timeline, however, was not disclosed.

Daiichi’s offer was earlier slated to open on August 8 and close on August 27. Market-watchers point out that SEBI approvals may be taking time, given that the Ranbaxy stake-sale was among the biggest seen by corporate India.

Also, the events that followed in the US may have required more scrutiny by the regulator, a pharma analyst observed. The merchant banker, however, declined to comment on the clarifications provided and said instead that it was a standard practice in the case of open-offers.

Under the proposed open offer, Daiichi will pick up approximately 92.5 million shares in Ranbaxy Laboratories from the market, close to 20 per cent of total company shares at a price of Rs 737 per share. The open offer follows the decision by Ranbaxy’s promoters to sell their entire stake to Daiichi.

But in the run up to the open offer, Ranbaxy was in the spotlight for various reasons, including its tryst with the regulatory US Food and Drug Administration. Ranbaxy’s medicines sold in the US came under the scanner of the US authorities.

The company’s scrip was also in the thick of action, when it was hammered in the market after Ranbaxy disclosed details regarding investigations carried out by the US authorities. The market was rife with rumours on the Daiichi-Ranbaxy deal.

The Ranbaxy top management, however, maintained that the deal with the Japanese drug maker was “binding” and final. Further, Ranbaxy’s Chief, Mr Malvinder Singh, alleged that multinational companies and an Indian firm were behind the share price hammering.

Ranbaxy shares fell by close to 23 per cent between July 11 and July 15 after the news about investigations by the US authorities filtered in. However, the share price bounced back on July 16 after company’s clarification.

On Thursday the Ranbaxy shares closed with 1.29 per cent gain at Rs 499.10 on the BSE.

Delhi Bureau adds

Meanwhile, the US Department of Justice said it intended to withdraw the motion filed against Ranbaxy as the drug maker had agreed to produce documents related to charges of fraud. “The Government intends to withdraw the motion upon full and complete production of Paraxel documents…. In consideration of the current pace and apparent agreement to produce Paraxel documents, the US respectfully requests the Court to hold the motion in abeyance for a reasonable period of time to allow Paraxel to produce the audit documents and to all the Government to confirm that all documents have been produced and to review Ranbaxy’s privilege for claim of opinion work product,” the US Government attorney said in a reply to the Maryland District Court in response to Ranbaxy’s reply to the motion.

The Department of Justice has been asking for reports of internal audit done by the US-based consulting firm Paraxel for Ranbaxy.

Ranbaxy said it expects the motion to get withdrawn by first week of August and it would continue to co-operate with the US Government. The US Department of Justice had filed a motion against Ranbaxy alleging fraudulent misconduct.

More Stories on : Open Offers | Pharmaceuticals | Ranbaxy Laboratories Ltd

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Corporate developments

Copyright © 2008, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line