The USD 4-billion merger of Ranbaxy Labs with Sun Pharmaceutical has got clearance from the two leading stock exchanges — BSE and NSE.
The ‘no-objection’ from the two exchanges would allow the two companies to file their scheme of amalgamation with the High Court for further clearance of the deal and marks one of the numerous regulatory approvals that Sun Pharma and Ranbaxy need to consummate for the transaction.
The deal had separately come under scanner of the markets regulator Sebi for alleged insider trading violations and the present ‘no-objection’ from the exchanges.
The combination of Sun Pharma and Ranbaxy creates the fifth-largest speciality generics company in the world and the largest pharmaceutical company in India.
The two firms now need clearances of the High Court and Competition Commission of India (CCI), among others.
In separate communications to Sun Pharma and Ranbaxy, NSE and BSE said they are granting their ‘no-objection approval’ to the proposed scheme and this observation letter would be valid for six months, within which period the companies would have to file the scheme with the High Court for further clearance.
The exchanges have noted the confirmation given by the company stating that the scheme does not violate or over-ride or circumscribe the provisions of various regulatory norms.
“Accordingly, we do hereby convey our ‘no-objection’ with limited reference to those matters having a bearing on listing /delisting/ continuous listing requirements within the provisions of the Listing Agreement, so as to enable the company to file the scheme with the High Court,” the exchanges said in a similar-worded circulars.
According to norms, companies seeking to execute merger or de-merger strategies need to obtain a ‘no-objection certificate’ from stock exchanges.