CNBC-TV18 shares with domain-b its exclusive interview with Mark Mobius:

Take us through your objection to Sun's offer to buy Taro.
Basically, it is a price issue. Since the original bid was made at $7, which is now outstanding by Sun, the prospects of the company has improved dramatically. Taro has really risen from the ashes from a very difficult time and it looks like it may be re-listed; it was earlier de-listed. So, the prospects are much better and the price that Sun is offering is not acceptable in view of that.

The agreements that Sun has had with Taro seem to be Sun's protection. How are the Israeli laws placed? Are they enough to stop or scuttle Sun's bid to build on its contract and force Taro's promoters to sell their 12-per cent stake?
According to the information we get from our Israeli Counsel, the Israeli law could prevent this from going forward if minorities object it. There is action-taking place in Israel. So, even if Sun wins in New York, then they would have to deal with the situation in Israel. So, there is that possibility. I am not making any predictions because I have no idea what the people and Courts in Israel would judge. But that is something we have to look at pretty carefully.

What would be Templeton's role in that case? Would you want to try the law in Israel itself and take Sun to Court in the Israeli courts?
We have supported Taro in their objection to Sun's takeover at that price, because we feel the price is not a good one. In that sense, we are supporting the Taro management and the key owners.

The question now is what will happen in New York. Sun has taken the issue to court in New York and what happens after that in Israel. This would probably be a long drawn out situation.

There is a reasonable amount of consolidation happening in the pharma industry globally and there could be other bidders who would evince interest in Taro. What would be the right price?
I am looking at $20. Originally, we were looking to something like $12 and then it went to $15 because the company has constantly shown improvements in their results. So, I am looking at around $20 per share, which actually is good news for Sun because they own a pretty substantial block. We own 13.5 and they own much more than that. So, they are making money on the increase in the valuations.

Do you know of any bidders making a beeline to Taro? Taro has apparently gone on record saying that there are other interested bidders.
That is what they said and I am not surprised. With the prospect of the company getting better, I am not surprised that they would be getting bids from other pharmaceutical companies. There is a lot of consolidation taking place in the industry.

Even if Sun does not get any offers at all for that mandatory open offer of $7.75, under the agreement that they had with Taro's promoters, the promoters will probably have to sell that 12 per cent. Is that legally foolproof or is that the one you are questioning?
That is going to be up to the law in New York. Sun has taken the issue to Court in New York and it is up to them to decide what is going to happen. Taro is saying that the bid made by Sun was not fair and so on. This is something that the Court will have to decide.

Taro has turned around rather significantly in the last one-year or so. Is Sun's fund infusion instrumental in any way in that turnaround?
I am sure it has. Sun was able to go in and support the company. I have no doubt that it had an impact, otherwise Taro would not have gone for the deal. It must have been some benefit. There is no question about that in my own mind.

Would you still think that despite that seminal role they played, it doesn't mean they should get Taro promoters 12 per cent share for $10.25 or thereabouts?
We objected to the original deal between Sun and Taro from the very beginning. We objected to it very strongly because we thought it was an unfair price. Our opposition has not changed at all.

How do you see this entire issue playing out? What do you think will be the next step? Will it be the US court's decision that you will wait for, or will you wait for the drama to play out in the Israeli court? What do Taro or Sun shareholders have to lookout for?
First, we have to wait for both these courts to make a decision, because it is incumbent upon the shareholders of both to be aware of these cases. It could have a tremendous impact on what happens. For example, if the New York court says the agreement is valid and imposable then the whole issue will have to move to Israeli courts, assuming that there is no appeal on the part of Taro. The Israelis will then have to make its decision because after all Taro is an Israeli company. So, the Israeli court's decision would prevail.

(See: Sun Pharma extends Taro tender offer)