Fair trade watchdog CCI has asked Sun Pharma-Ranbaxy deal to make public specific details of their proposed merger within ten days.
This is probably the first instance where the Competition Commission of India (CCI) has ordered a public scrutiny of a proposed merger and acquisition (M&A) deal to ensure compliance to fair trade regulations.
Sun Pharma and Ranbaxy, which had announced a $ 4-billion deal in April this year, were asked late last night to make public details of their proposed transaction in a "prescribed format" within 10 working days.
"The company has received direction vide letter dated August 27, 2014 under Section 29(2) of the Competition Act, 2002 from the Competition Commission of India (CCI) directing the company to publish the details of the proposed combination in the prescribed format within 10 working days from the date of the said letter of the CCI," Ranbaxy labs said in a stock exchange filing this morning.
In a similar filing, Sun Pharma also informed the stock exchanges that they "are in receipt of direction under Section 29(2) of the Competition Act, 2002 from the CCI directing Sun Pharma to publish the details of the proposed combination within 10 working days from August 27, 2014 in Form IV contained in Schedule II to the Combination Regulations".
Under this section, if the CCI is "prima facie of the opinion that the combination has, or is likely to have, an appreciable adverse effect on competition, it shall... Direct the parties to the said combination to publish details of the combination within ten working days of such direction...".