Symbiotec Pharmalab IPO: DRHP shows Rs 1,507.92 million legal claims against company
The Draft Red Herring Prospectus (DRHP) of Symbiotec Pharmalab showed that the company is facing multiple legal proceedings, including six tax proceedings and one material civil litigation, with the aggregate amount involved against the company standing at Rs 1,507.92 million.
Symbiotec Pharmalab’s Rs 1,757 crore initial public offering opened for subscription on Monday and will remain open until August 27. The pharmaceutical and biotechnology company has fixed the price band at Rs 938-988 per share.
According to the DRHP, there is one criminal proceeding by the company and six tax proceedings against the company. It also faces one material civil litigation, with the aggregate amount involved in proceedings against the company disclosed at Rs 1,507.92 million.
The company said its outstanding legal proceedings are pending before various courts and authorities. It cautioned that an unfavourable decision in such proceedings, individually or in aggregate, could adversely affect its reputation, continuity of management, business, results of operations, financial condition and cash flows.
The DRHP also highlights legal proceedings involving the company’s directors, subsidiaries and promoters. Directors, excluding promoters, face two criminal proceedings and 11 tax proceedings, with the aggregate amount involved disclosed at Rs 4.12 million.
The company’s subsidiaries are also involved in legal proceedings. One criminal proceeding is reported against the subsidiaries, with an aggregate amount of Rs 3.67 million involved. The DRHP also discloses one material civil litigation by the subsidiaries.
Among promoters, one criminal proceeding, one tax proceeding and one material civil litigation are disclosed against them.
One of the subsidiaries, Knovea Pharmaceutical Private Limited, is involved in a material civil litigation before the High Court of Madhya Pradesh. The subsidiary had filed a writ petition challenging the validity of the Draft Pitampura Master Plan, 2035 and related notifications concerning land acquired for a research and development centre and a manufacturing facility.
The High Court, in its orders dated April 6, 2023 and August 22, 2023, stayed the operation of the relevant notification and issued notices, with the matter remaining pending, according to the DRHP.
The company has classified the disclosed proceedings in accordance with its materiality policy and noted that the amounts stated are to the extent ascertainable and quantifiable.
