May 5, 2014 / 12:50 PM / 6 years ago

Sun Pharma denies unit's role in Ranbaxy share run-up before deal

A logo of Sun Pharmaceutical Industries Ltd at its research and development center in Mumbai April 7, 2014. REUTERS/Danish Siddiqui

MUMBAI (Reuters) - India’s Sun Pharmaceutical Industries Ltd (SUN.NS), which is to buy rival drugmaker Ranbaxy Laboratories Ltd RANB.NS for $3.2 billion, said its unit Silverstreet Developers LLP had no role to play in the run-up in Ranbaxy shares ahead of the deal announcement in April.

Sun Pharma said it had “no access to non-public information of Ranbaxy” when its unit Silverstreet bought shares in Ranbaxy.

Ranbaxy shares had risen 24 percent and trading volumes tripled in three sessions ahead of its announcement on April 7 that Sun Pharma would buy the loss-making company from Japan’s Daiichi Sankyo Ltd (4568.T).

“We hereby confirm that we had not bought any shares in the period from 1st April to 7th April,” Sun Pharma said in a statement to the National Stock Exchange. “Silverstreet had previously bought these shares as a matter of investment.”

Sun Pharma’s acquisition of Ranbaxy was temporarily halted last week by an Indian court in Andhra Pradesh state, pending its decision on a petition demanding a probe into alleged insider trading in Ranbaxy shares.

The court also asked all the involved companies, the regulator, and the stock exchanges for details, according to an order dated April 25 posted on the court’s website.

“We were not served the notice of the hearing for the AP High Court case referred to and the matter was decided ex parte,” Sun said on Monday. It added that it was responding to a request for clarification from the NSE on a news item that said the Sun-Ranbaxy deal had hit a “hurdle.”

The Indian market regulator said last month that it sought information from Ranbaxy and Sun Pharma on the transaction and would ask for stock exchange trading data, after it had received “multiple complaints”.

Reporting by Zeba Siddiqui in Mumbai; Editing by Anand Basu

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