By Phil Milford – Jul 26, 2012 10:08 AM ET.
Par Pharmaceutical Cos. (PAR), the generic-drug maker being bought by TPG Capital for $1.9 billion, was sued by a shareholder who contends investors will be shortchanged in the deal.
Directors of Woodcliff Lake, New Jersey-based Par are duty- bound to enhance share value in a takeover and have avoided competitive bidding, Rena Nadoff contended in a July 24 complaint filed in Delaware Chancery Court in Wilmington.
“The long-term prospects for Par are great” and the sale price of $50 a share is too low, Nadoff said. Par “is in a position to see increased revenues with the implementation of the healthcare reform act,” as the law’s emphasis on cost control spurs increased use of generic drugs, Nadoff said.
Nadoff asked a judge to stop the transaction and award damages and legal fees. Par and TPG, a private-equity firm based in Fort Worth, Texas, said July 16 they agreed to the deal at a 37 percent premium, subject to a shareholder vote and regulatory approval.
Allison Wey, a Par spokeswoman, didn’t immediately reply to a voice-mail message seeking comment on the lawsuit.
The case is Nadoff v. Par Pharmaceutical Cos, CA7715, Delaware Chancery Court (Wilmington).
To contact the reporter on this story: Phil Milford in Wilmington, Delaware at pmilford@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net
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