The Supreme Court Wednesday asked the Andhra Pradesh High Court to decide in two days the issues that have been raised to stall the amalgamation of Ranbaxy laboratories limited with Sun Pharmaceutical Industries limited following a $4 billion takeover deal.
Sun Pharma had bought the stakes of Ranbaxy laboratories from Japan's Daiichi Sankyo Co. in a $3.2 billion deal and $800 million of debts liability.
The high court April 25 asked the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) not to give their nod to the merger of Ranbaxy with Sun Pharmaceutical Industries limited.
The high court order for a status quo came on a plea by two retail investors, Tammali Shiva Kumar and Undi Venkatasubbaraju, who alleged insider trading in Ranbaxy's shares just before the takeover deal.
The Supreme Court bench of Justice B.S. Chauhan and Justice A.K. Sikri said the high court would decide the matter within two days as it directed the listing of the matter May 29 for its consideration.
The apex court also observed that the Andhra Pradesh High Court had no jurisdiction to entertain any such plea. Appearing for the Sun Pharmaceutical Industries limited, senior counsel Abhishek Manu Singhvi told the apex court that it was an absolute abuse of the procedure of the court to stall the biggest $4 billion merger deal by an Indian pharma company that makes India proud.
Describing the ex-parte order of status quo as unreasonable, Singhvi alleged that two matters were pending before the Punjab and Gujarat high courts and the instant case was that of there was forum shopping (bench hunting).
The apex court responded saying they too were discussing the same. The court was told that only the Punjab and Haryana High Court and Gujarat High Court had the jurisdiction because Ranbaxy laboratories limited was based in Punjab and Sun Pharmaceutical Industries limited based in Gujarat.
As senior counsel V. Giri appearing for Tammali Shiva Kumar sought to make submission, the court asked him if he was a share holder and what was his locus standi. "Are you a share holder, if you are you can have locus," the court said.
Singhvi reiterating the allegation of abuse of the procedure of the court, said they have miniscule shares which were less than .01 percent and coming in the way of a very large number of shareholders. While Ranbaxy has 182,721 shareholders, Sun Pharma has 139,546 shareholders, the court was old.
