Israel-Medical-Healthcare

[genisi]

Taro meeting to take place as planned

The District Court has ordered the company's shareholder's meeting to be held tomorrow. Franklin Templeton has appealed to the Supreme Court.

Gitit Pincas 22 Jul 07 17:33

During last Thursday's hearing in the Tel Aviv District Court, Judge Nurit Ahituv said repeatedly that she did not understand the goal of Franklin Templeton Resources Inc. (NYSE: BEN) in seeking to block the sale of Taro Pharmaceutical Industries Ltd. (Pink Sheets: TAROF.PK) to India's Sun Pharmaceuticals Industries Ltd. (BSE: 524715). This was the general idea that lay behind her decision the following day to dismiss Franklin Templeton's petition for an injunction against the shareholders' meeting to approve the sale, which will now go ahead tomorrow, as planned. Franklin Templeton filed an urgent appeal this morning with the Supreme Court.

Franklin Templeton, which in the meantime has lowered its holding in Taro to 7.9% is seeking an injunction under which a special manager will be appointed for Taro, and the initial share allocation to Sun, which was made ahead of the sale, as well as the sale by Taro's controlling shareholders of their stakes will be made contingent on the approval of the court. It is also seeking a court ruling cancelling or postponing tomorrow's shareholders' meeting, since Taro's shareholders do not have the data and information, including the company's financials for 2006 and the first quarter of 2007, that would enable them to make the decision.

In her ruling Judge Ahituv held that the share allocation to Sun could not be revoked, since the Indian company had relied on Franklin Templeton's willingness to consent to a lowering of the price, and had "paid a considerable sum for its shares." Franklin Templeton would suffer no irreversible damage if the meeting went ahead as planned, she said, and even if the votes of Sun itself tipped the balance in its favor, Franklin Templeton would still have sufficient time to file for an injunction to stop the merger from going ahead.

In addition, Judge Ahituv did not order Taro to publish its financials for 2006 and the first quarter of 2007, and merely ruled that if Franklin Templeton was willing to sign a confidentiality agreement, it could see the financials before the meeting is held tomorrow.

Published by Globes [online], Israel business news - www.globes.co.il - on July 22, 2007