"Please do not get me wrong and I don't mean to be rude but are your delusional ? Are you not getting what Sun is doing with TARO ? You keep on talking about why the independent directors are not doing this and that .. why Taro did not out bid Sun, etc etc ! TARO DOES NOT EXIST as a INDEPENDENT ENTITY. It is completely under the control of SUN. Sun wants to destroy TARO's share price. They want to destroy minority rights, PERIOD. They will keep working on it ( in stealth) till they get the remaining 30% of Taro for free ! Again, TARO does not have its own corporate governance. "
I second that. I think Rahul hit the nail on its head!
Yes- Sun wants to steal Taro- they'll do everything they can get away with in order to get it as cheap as possible!.
I'll expand on a tangential point. I agree that talking about "what the independent directors at Taro should do " while we all know that for years those "independent " directors cannot care less about Taro minority and they are there to serve Sun interests (Pekelman ?) and that there is no chance for that to happen under this management.
Another problem is the benign suggestions such as "Taro should buy xyz" when we all know that it is not going to happen . I suspect that the purpose of such suggestions is to eclipse topic that are critical of Sun and Taro's management by replacing them at the top.
Or when the post is "we should thank Dilip" (what a sense of humor, to thank the guy who is screwing minority)
Or when the post "I trust Taro's decisions" ( yes sure! we should trust them because for years they are trying and succeeding in screwing minority and we should thank them for that.)
Yes, I think such suggestions, In the best case, can come from a sucker. In the worst case , there is a possibility that we are dealing with a fifth column (may be self appointed) who once asked Sun-Taro for a job in a post in this forum. If you cannot find the posts mentioned here it because he deletes t
Here is my interpretation about the Keveyes move.
I don't think the point was "over-hyped new FDA approved drug" is responsible for the Taro's slump because there was not "over-hype" and price did not go up after the announcement of approval. The point is the timing of Taro announcement of distributing it for free while incurring the expenses.
Some of the market ( the suckers ) believed that it was a bonefide move, without an intention to to cause a drop in Taro's price, But this section of the market must has thought that it could be only explained by: Taro's management is completely INCOMPETENT - otherwise how could they spent so much R&D money on a drug that have no buyer?
The other section of the market interprets the timing of the "give away" as an attempt to cause a slump to Taro shares while the buyback is going, so Sun can increase its ownership in Taro for even less money per share. For that section , Sun-Taro timing of the move is another example how it is nurturing the mistrust in itself and about manipulation . And indeed, they further mistrust Sun-Taro management.
Whether it was “management incompetent" or "the timing of the move is about manipulatin and about creating a deeper mistrust in management" , both sections of the market were handed by Sun-Taro management a good reason to sell - and they did. “So it is all about the Sun-Taro management.
IMHO, since sometimes you post, and then you whimp-out , and you remove your post and other people posts in the process, If you intend to post on this topic, please do it in a different topic. Thanks.
1. If it is really "benami" than the holders sell only on Sun's order, because by definition it is Sun's money and not the holders'. So what ever the "benami" holders are doing it is by Sun's order and to their own benefit and to the detriment of minority.
(I think it is "benami" but we can't prove it - Sun refuses to reveal the holders' identities.
2. If the "benami" holders sell, that depresses Taro's price and it is in contradiction to the a buyback intention, minority are being hurt and Sun-Taro buy even cheaper and that increases its Sun's ownership in Taro even more - hardly to the benefit of minority.
3. If "benami" holders sell it is for the temporary benefit of Sun, but it reduces the ratio of the "benami" in the minority, therefore they will be buying again after the buyback is over in order to increase their share in the minority ( ostensibly "disinterested".)
In order to find the info, you can Google, for example, ‘blue mountain BBH taro’.
the first on the list is prnwire (Mar 20, 2014) with a letter from Blue Mountain to Taro investors titled ‘BlueMountain Capital Management, LLC Urges Minority ...’ in a quote from this article BM claims “In summary, as is reflected in the voting information delivered to BlueMountain and IsZo, 13,856,201 shares held at BBH were voted at the General Meeting. To the best of our knowledge 9,938,295 of these shares are owned by Sun or its affiliates. The remaining 3,917,906 shares were voted as disinterested shares (i.e. shares having no personal interest in the resolutions). All 3,917,906 shares were voted in accordance with Taro's recommendation on every item of the agenda. These 3,917,906 shares – held at the same custodian as Sun's 9.9 million shares – represent approximately 70% of the 5.7 million shares that were deemed to be disinterested that voted for the incumbents' re-election and more than 25% of all outstanding minority shares at that time. ”
Another interesting reading is the second on the list. It is an article from Motley Fool (Jun 13, 2014) titled Why I'm Avoiding Taro Pharmaceuticals . the author there describes other shenanigans of our good friends at Sun. including the ‘benami’ (I like this word) at Brown Brothers Harriman ("BBH")
So here you have it, the exact number of share habored at BBH is 3,917,906
Sun-Taro would not elaborate about the nature of the account of 3.912M Taro’s shares harbored at BBH. May be it is benami may be not. But it is surely smells like one. Therefore, in this post it is surrounded with double quotations - “benami”
If this is the case and with all the recent hectic trading in Taro's shares, I wonder what happened to the “benami” at BBH. Does it still harbor 3.912M shares of Taro at this account? Has it been used to sell Taro’s shares in this “bye-back”? (A buyback for the purists) or maybe it even grew and took advantage of the recent slide down in Taro’s price? Sun-Taro would not tell.
Definition of ‘benami’ from merriam-webster dictionary:
1. : made, held, done, or transacted in the name of (another person) —used in Hindu law to designate a transaction, contract, or property that is made or held under a name that is fictitious or is that of a third party who holds as ostensible owner for the principal or beneficial owner
Thanks to IMHO for educating us about the Hindu term of ‘benami’.
Also, once I saw IMHO’s post regarding benami I was wondering how long it will take him to remove his post (and in the process removing other people’s responses to his post.) He has been doing it repeatedly. And surely enough the post and its responses was removed by IMHO.
To sunil_chirania who wrote In an earlier post: “I doubt Sun has any plans to grow Taro inorganically.”
Sunil, have no doubts - Sun is the biggest obstacle to Taro's growth. Not only they have no plans to grow Taro's inorganically, but they have plans to milk and exploit Taro for the benefits of Sun as much as possible and to the detriment of Taro's minority. Based on past behavior, one have to be a sucker to believe Kal's statement that he ( means Sun) is open to buy assets "but pharma assets are too expensive"., well , since then, Pharma’s assets went down a lot, and there are many opportunities out there, but it's look like only Sun's directors can identify and buy "cheap assets" ,( most recently, they are buying 293M from Novartis) the same directors, while sitting on Taro's board cannot "see" the opportunities even if it hits them on the head – or most likely they are refusing to see!. Instead they are resorting to financial engineering instruments, with dubious timing, in order to increase their ownership in Taro's while paying minimal premium for it, if at all.
Indeed, the market is no sucker, it realizes Sun’s game, and it takes away P/E points from Taro’s share and gives it to Sun’s share. Taro’s minority investors, if you want to know where is your lost Taro’s wealth is – look at Sun’s share. That is why Sun’s P/E is 49 while Taro’s P/E is only 10.5 . Yes, Sun was able to transfer Taro’s minority wealth to itself without a even submitting a buyout offer. Amazing, isn’t it?
not going to happen.!
First the excuse was 'assets are too expensive' now that assets are cheap and management run out of excuse, instead, management resorted to futile financial engineering which will do nothing to lift Taro's stock.
Also, Taro growing inorganically may restore the trust of the market in Sun-Taro's management which may in turn lift Taro's stock - This is definitely against Sun's interest, especially while the buyback is going on and is intended to raise Sun's ownership in Taro for no premium. ( yes, the buyback momentum fizzled intentionally or otherwise.)
do you mean Bluemountain Capital rather than BlueCapital?
* Can you please give more details on how to find the article.
* 'Globes' has an English version besides the Hebrew version. - did u find anything there?
* I think Yahoo MB is now more relaxed on URL . Try to put it in, or
* try to put the URL in replacing the (.) with the word DOT
"I see no compelling reason to tender my shares." - in this buyback there is no tendering. S-T simply can go to the market and buy when the price is to their liking, or approach an institution with an offer. again No tendering is required.
Well written Tom!!
Indeed I won't t be surprised if the buyback will not add a cent to the price of Taro.
The price usually rise because of buying pressure and rising prices are public. Few times in the past Sun bought shares by negotiated transactions where the price not published, and investors did not benefit.
I remember 2 cases. May be there were more that we did not hear about.
While Sun's offer of $7.75 was still standing, and Taro's share was trading between $7 and $8, Sun bought from one of the institution shares for a price of 11.5 to 12.5 - about %50 premium to the market, yet at the time, nobody knew about the transaction and obviously not about the premium - there was no benefit to none-Sun investors ( we can't call them minority at this time, because Sun did not hold the majority of the shares).
The second case - a few years later, Taro was trading at $14/share, and Sun bought all shares held by Franklin-Templeton for $16 ( yes it was the market guru Mark Mobius who sold F-T shares to Sun) The market did not know about the transaction and continued to trade at $14 for a few more months. no benefit to minority.
So here again, S-T can buy from institutions in a secretive deal and there will be no price rise for Taro.
Furthermore, S-T can buy from one of the stashes (we know about the stash of $3.9M shares parked at BBH, I believe there are more) for a price that is theoretically even below market price and no one will know about that. again no benefit to minority.
So when we are dealing with a management with a proven disregard to its minority investors, we should be very alert as to their motives and intentions.
Here is a snippet of my post at Seeking Alpha at 8:40pm EST , in response to the buyback :
"... Another suspicion - may be Sun-Taro's management is sensing that the FDA approval of phase 2 of Novexatin is right around the corner, so this buyback intends to increase Sun's share in Taro, before the Novexatin spike. .."
Yes, when I heard about the buyback I immediately thought how our "decency and integrity" oozing management is trying to screw minority . and this thing came to mind - may be S-T management is hoping to preemp the benefits of Novexatin announcement.
This buyback will reduce Taro's float and increase Sun's shares in Taro (since Sin Pharma is not selling in the open market.) without Sun paying any premium.- Currently Taro and Sun have almost identical top management yet Taro’s P/E is 9.8, (which is a disgrace to Sun-Taro’s management,) while Sun Pharma’s P/E is 70.
The market went through a big correction in the Pharma sector and it is replete with inexpensive buying opportunities. If Kal and Dilip really wanted to develop Taro’s business they could easily pick one or two assets, but to my assessment they are not! So instead they chose to deplete Taro's cash in order not to use it for an inorganic growth (and increase Sun’s share in Taro while doing so.)
Another suspicion -This is a preemptive move: May be Sun-Taro's management is sensing that the FDA approval of phase 2 of Novexatin is right around the corner, so this buyback intends to increase Sun's share in Taro, before the Novexatin announcement will spike Taro’s share.
Valery164, everybody knows that Taro is dirt cheap, yet their motive is to use i this buyback to Sun’s benefit, not yours or mine!
In Taro’s case you are looking at the wrong place. May be there is no other company with numbers (P/E, EBITDA) like Taro’s. But no other company has Taro’s management for a management either. So the answer is not in the P/E or EBITDA.
The answer is in Sun-Taro’s management.
Taro’s number will continue to look “great” and its price share will be lousy
-as long as Taro will have a management that is working for the interests of Sun and against the interests of its minority,
-as long as Kal and Dilip will continue to insult minority’s intelligence in conference calls with their “answers”,
-as long as Taro is hiding behind “Growth through research” – meaning nothing else, NO growth through new marketing, NO inorganic growth,
-and long as Sun-Taro management will continue to nurture mistrust in themselves (because it serves them well) Sun will have a P/E of 70 and Taro a P/E of Taro of 10!