The erstwhile promoters of Ranbaxy Laboratories, the Singh brothers and family have been asked to pay damages of Rs 2,562.78 crore to Daiichi by an arbitration tribunal here for concealing and misrepresenting information during their stake sell to the Japanese firm.
Malvinder Singh, currently the Chairman of Fortis Healthcare, and family including his brother Shivinder Singh, had sold their entire stake of about 35 per cent in Ranbaxy for $2.4 billion in 2008 to Daiichi Sankyo.
However, in 2013, the Japanese pharmaceutical major had filed an arbitration case in Singapore accusing the Indian promoters of concealment and misrepresentation of facts after Ranbaxy paid $500 million to the US Department of Justice as settlement for misrepresenting facts.
The arbitration tribunal has issued an award by a majority of 2:1 in favour of the claimant for damages of an amount of Rs 2562.78 crore, RHC Holding Pvt Ltd said in a statement.
RHC Holding Pvt Ltd is among the sellers of shares of erstwhile Ranbaxy Laboratories along with Oscar Investments, which have been named as respondents in the arbitration suit by the claimant, Daiichi Sankyo.
The statement added the damage amount to be paid include “quantified interest, costs and expenses of the arbitration till the date of award and interest on above until date of payment, against all the respondents jointly and severally”.
Commenting on its future course of action, RHC Holding said: “The company is exploring further legal options to challenge the majority award.”
It, however, declined to share details stating “all the parties to the arbitration are bound by confidentiality obligations as a part of the arbitration proceedings.”
When contacted Malvinder Singh declined to comment.
After buying out the erstwhile promoters, Daiichi spent a total of around Rs 22,000 crore to gain a majority stake in Ranbaxy. Later on, the Japanese firm exited Ranbaxy following a $4.2 billion merger deal between Sun Pharma and Ranbaxy.
Last April, Daiichi Sankyo sold its entire stake of around 9 per cent in Sun Pharmaceutical Industries for over Rs 20,420 crore, which it received after merger of Ranbaxy in the Indian firm, ending its seven years of tumultuous experience in the country.