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Israeli court orders temporary halt to Kitov Pharmaceuticals-TyrNovo deal


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Israeli court orders temporary halt to Kitov Pharmaceuticals-TyrNovo deal

Kitov Pharmaceuticals Holdings Ltd. said the Tel Aviv District Court on Jan. 19 issued a temporary interlocutory injunction, prohibiting Kitov and Goldman Hirsh Partners Ltd. to take any further steps to complete Kitov's acquisition of a 56% stake in Israel-based TyrNovo Ltd. from Goldman Hirsh, but only to such an extent that transaction had not yet closed.

The court's order is in response to a motion filed by Taoz – Company for Management and Holdings of Companies Ltd., a shareholder with a 3.12% stake in TyrNovo. Taoz is alleging certain rights as a minority shareholder in TyrNovo.

The court rejected the additional temporary interlocutory injunctive relief sought by Taoz, including changes to the composition of TyrNovo's board and Goldman Hirsh making any disposition of its holdings in TyrNovo.

Taoz is also alleging purported contractual rights with Goldman Hirsh and/or TyrNovo which are alleged to bind third parties. The alleged rights include pro rata tag-along rights over any transfer of shares by Goldman Hirsh in excess of 5% of TyrNovo's issued and outstanding share capital; and rights to prevent a sale by Goldman Hirsh of more than 14% of TyrNovo's capital.

The court ordered Taoz to deposit funds or post a bond in the amount of 100,000 Israeli shekels by not later than Jan. 22; ordered the respondents to submit responses to the motion by Jan. 23; and scheduled a hearing with respect to the motion to be held Jan. 29.

Kitov said the completed TyrNovo acquisition closed in accordance with its terms on Jan. 13, and is seeking clarification in the decision with respect to certain aspects of the injunction to the extent that it applies to the post-closing matters surrounding the acquisition.

As of Jan. 20, US$1 was equivalent to 3.80 Israeli shekels.