Mumbai: Sun Pharma's bid to takeover Israeli firm Taro Pharmaceuticals could take longer due to a legal tussle, Sun Pharma chairman and managing director Dilip Shanghvi said.

''Going by the behaviour displayed by Taro Pharmaceuticals, its director and the Levitt family and its passion for filing court cases, it appears that ultimate resolution for all issues involved is likely to take quite a bit of time,'' Shanghvi said, while ruling out chances of an out-of-court settlement with the Israeli.

''It's not something that will get over very soon,'' he said, adding, there are other options before the company ''to secure our long-term interests and we remain committed to the completion of this transaction''.

Addressing industry analysts during the announcement of the company's first quarter results, Sanghvi said it plans to use all existing facilities of Taro to the maximum and to increase investment in R&D in Israel.

Sun also reaffirmed its commitment to maintaining and enhancing Taro's facilities in Israel, and to a fruitful relationship with Taro's employees, after Sun acquires control of Taro.

The clarification followed reports saying the mayor of Haifa had sent a letter to Israel's minister of industry expressing concern over Sun's plans to shift production to India once it acquires Taro.

On the other hand, Sun Pharma said it wants to better utilise the Taro facility. ''Sun Pharma reiterates that it has no plans to close Taro  facilities or lay off people – the exact opposite is true,'' he said..

''We believe that the current management of Taro is significantly underutilising its facilities and has considerably reduced its investment in R&D, which is so vital for the future of a pharma company. Sun Pharma will reverse this, '' said Shanghvi.

Sanghvi cited Sun's US acquisition in 1997 of Caraco, a US company in Detroit with annual revenues of less than $1 million employing less than 50 people.  ''Today Caraco employs 650 people, has annual revenues of $150 million from its own products. Caraco is expanding its manufacturing facility by another 140,000 sq ft in Detroit, to create 1500 additional direct and indirect jobs,'' he said.

''We will work towards clarifying to the mayor our position in this regard and to communicate that we want to leverage an existing investment of more than $200 million in infrastructure and knowledge in Israel to make Taro into a truly great company,'' Shanghvi added.

Sun had, earlier, extended the tender offer for purchase of all outstanding ordinary shares of Taro up to 2 September.

Sun's decision had had been triggered by Taro's unilateral termination of Sun's $454-million merger proposal.

Executed through Sun Pharma's wholly-owned Hungary-based subsidiary Alkaloida Chemical Company Exclusive Group Ltd, the offer was scheduled to close on 28 July. As of 11 July, 700 ordinary shares had been tendered and not withdrawn from the offer, Sun said in a note.

Sun Pharma at present holds 36 per cent in Taro, and by exercising its option to acquire the controlling shareholders' shares, it would get 12 per cent of the economic share, taking its share up to 48 per cent. Sun Pharma's voting shares would go up to 65 per cent.