Taro Pharmaceutical (TARO) Acquisition Misrepresentation Case

S.D. New York

Court

7:24-cv-06818

Case number

17 Jan 2024

Class period Start

09 Sept 2024

Class period End

12 Nov 2024

Lead Plaintiff motion deadline

$TARO stockholder filed a claim against. Taro Pharmaceutical Industries. for misleading investors about the fairness of Sun Pharmaceutical Industries' acquisition, shareholders argue that they were misled into accepting $43 per share, even though Taro’s stock had previously reached $41.28. Investors claim they were not given the full financial details. These missing details made the deal seem fair when in reality, it undervalued the company.
On April 15, 2024, Taro submitted a proxy statement to the SEC that left out key details about the financial analysis by BofA Securities, which misled investors into thinking the deal was fair.
Case Details:

On January 17, 2024, Taro Pharmaceutical Industries announced its acquisition by Sun Pharmaceutical Industries for $43.00 per share.
The acquisition was presented as a favorable transaction, but shareholders allege that the proxy materials failed to disclose important details about the valuation methods and assumptions used by BofA Securities.
On April 15, 2024, Taro submitted a proxy statement to the SEC that allegedly misrepresented important financial details, specifically the discount rate and cost of capital. These figures are key to evaluating the present value of future cash flows in the deal.
By leaving out or manipulating these numbers, Taro gave shareholders a misleading view of the deal's fairness, causing them to approve it based on incomplete information. This made the deal seem better than it was.
On June 24, 2024, the acquisition closed, and Taro shareholders received $43 per share.

Based on these events, $TARO stockholder filed a claim against Taro, Sun Pharmaceutical, and its directors, accusing them of the following:
Misleading shareholders by omitting material information from the proxy statement.
Failing to fully disclose the assumptions behind BofA Securities’ valuation analysis.
Considering these allegations, investors have reason to suspect that Taro misrepresented the fairness of the acquisition, impacting their decision to approve the transaction.

One of TARO’s investors has already filed a claim against Taro in the S.D. New York court

Case Status

Lead Plaintiff Submission

Alleged Offence

Misleading Statements,

Failure to Disclose

Suspected Party

Directors,

Investment Bank

Security Type

Stocks

Trade Direction

Long

Shock Event Date

15 April 2024

Filing date

09 September 2024

Lead Plaintiff Deadline

12 November 2024

Judge

Hon. Cathy Seibel

Taro Pharmaceutical (TARO) Acquisition Misrepresentation Case

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