Sebi gets complaints on Ranbaxy share trade before merger deal

Tags: News
Market regulator Sebi has received multiple complaints about alleged irregularities in trading of Ranbaxy shares before the announcement of its multi-billion dollar merger deal with Sun Pharmaceutical.

Securities and Exchange Board of India has started collating data related to the matter from stock exchanges and clearing corporations, sources said.

In one of the biggest deals in the domestic pharma sector, Sun Pharmaceutical Industries announced on Monday that it would acquire troubled rival Ranbaxy Laboratories in a $ 4-billion deal that includes $ 800 million debt.

Shares of Ranbaxy had witnessed substantial movements on the exchanges last week itself. From March 31 to April 4, shares of Ranbaxy jumped 26 per cent. The scrip today closed at Rs 467 on the BSE.

The sources said Sebi has received multiple complaints regarding suspected irregularities in the trading of Ranbaxy shares in the run up to the deal announcement.

During that period, there have been heavy intra-day surges in volumes as well as prices of Ranbaxy shares.

Complaints have been received from various quarters including brokers, investor associations, proxy advisory firms, fund houses, Foreign Institutional Investors and Association of National Exchanges Members of India, the sources said.

The capital market watchdog has started collating data related to movement in Ranbaxy shares including from stock exchanges and clearing corporations, sources said.

Sebi is also gleaning data available on its Integrated Market Surveillance System. Through IMSS, it collects data for suspicious market activities through multiple sources, including its network systems at stock exchanges and other market infrastructure institutions.

According to sources, exchanges were believed to have been informed about the Ranbaxy deal after the midnight on Sunday. Entities suspected of having prior information about the deal before the official announcement are under the scanner, they added.

The combination of Sun Pharma and Ranbaxy would create the country's largest pharmaceutical company with an estimated combined revenue of $ 4.2 billion. The entity would also be the fifth-largest speciality generics company in the world.

Meanwhile, Sun Pharma today denied insider allegations of trading against Silverstreet Developers LLP, a wholly owned arm, related to the deal with Ranbaxy.

In a statement, Sun Pharma said the matter related to purchase of shares of Ranbaxy by Silverstreet Developers LLP "does not violate insider trading rules".

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Tighter disclosure norms will help public shareholders

    The Securities and Exchange Board of India (Sebi) has proposed changes in listing agreements between companies and stock exchanges, laying down manage

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Arun Nigavekar

Why UGC must focus on quality

In a vast country like India, where there are pressures ...

Rajgopal Nidamboor

The sum total of our conscious experience

All of us epitomise a multiplicity of conscious thoughts. This ...

Gautam Gupta

Don’t let success kill the essence of the concept

In 1999 when my mother started her own label, we ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture