Oct 14 (Reuters) – Australia’s New South Wales Court of Appeal on Wednesday rejected Cosette Pharmaceuticals’ bid to terminate its takeover of Mayne Pharma, upholding a lower court ruling that the US-based drugmaker had no valid grounds to abandon the deal.
Here are some of the details:
• Cosette bid A$7.40 per share for Mayne in February last year but later tried to back out, saying a deterioration in Mayne’s financial performance constituted a material adverse change that voided the agreement.
• The NSW Court of Appeal upheld the trial judge’s finding that the decline in Mayne’s sales performance was insufficient to meet the threshold for a material adverse change under the scheme implementation deed.
• The appeal court held that through its conduct at the first court hearing on the scheme, Cosette had chosen to affirm the deed, giving up any right it may have had to terminate.
• The court rejected Cosette’s claim that Mayne had misled it regarding its expected 2025 earnings performance. It ordered Cosette to pay the legal costs of the appeal.
• Mayne Pharma will continue to pursue claims for damages against Cosette, parent Cosette Pharmaceuticals Holdings, and controllers David Burgstahler and Avista Capital on behalf of itself and its shareholders, Mayne Pharma Chair Bruce Robinson said.
• “Mayne Pharma remains committed to continuing to maximise shareholder value and remains focused on continuing to strengthen the business,” Robinson said.
• The A$672 million ($470.13 million) takeover has faced political opposition, with South Australian Premier Peter Malinauskas criticising the transaction. Federal Treasurer Jim Chalmers blocked the deal in November last year on national interest grounds.
• Shares of Mayne Pharma rose as much as 11% to A$2.820, logging their best intraday session in more than two months, after trading resumed.
• Cosette has until November 11 to appeal the decision in the High Court, Mayne Pharma said.
($1 = 1.4294 Australian dollars)
(Reporting by Rajasik Mukherjee and Keshav Singh Chundawat in Bengaluru; Editing by Subhranshu Sahu)
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