Tokyo-based Daiichi Sankyo has asked an Indian court to make sure former Ranbaxy owners Malvinder and Shivinder Singh set aside enough capital to meet an arbitration award that could reach $525 million.
Earlier this month, the brothers were ordered by an arbitration panel to pay Daiichi Sankyo in a case that alleged the siblings hid key information while negotiating the sale of the firm in 2008.
The Business Standard reported that the brothers replied to the filing in the Delhi High Court that they would indeed keep assets of INR35 billion on hand to pay the award should an appeal in process fail.
But the court has so far not issued a formal order on any assets held by the brothers, the Business Standard reported.
The award--made after hearings held in Singapore under the France-based International Court of Arbitration--comes in the wake of Daiichi exiting Ranbaxy in 2015 through a sale to Mumbai-based Sun Pharmaceutical Industries.
Shortly after the original deal went through, manufacturing and related quality control problems surfaced that were highlighted by a whistleblower who tipped off U.S. authorities, leading to Ranbaxy pleading guilty to 7 felony charges and a $500 million settlement payment from Daiichi.
Sun Pharmaceutical inherited several of the manufacturing problems in its purchase and last year announced a detailed triage plan to fix or shut plants--even as it works through its own quality control issues.
The complex legal and regulatory history has seen Daiichi Sankyo take no chances, the Business Standard noted.
"We have an imminent fear that there may be various alienations (asset sell-off) by RHC Holdings (a company run by Malvinder) in case there are no protective measures provided by the court. We request you to ask the respondents (Singh brothers) to issue a statement of safeguard and security," Gopal Subramanium, legal counsel in India for Daiichi Sankyo, told the court, according to the Business Standard.
- here's the story from the Business Standard