AHMEDABAD: Homegrown pharma major Sun Pharmaceutical Industries Ltd on Monday announced it has signed a definitive agreement to acquire US-based Organon & Co in an all-cash transaction at $11.75 billion. The US-listed firm’s acquisition marks one of the largest outbound deals by an Indian drugmaker.Under the agreement, Sun Pharma will buy all outstanding shares of Organon for $14 per share. The transaction, approved by the boards of both companies, is subject to regulatory clearances and shareholder approval and is expected to close in early 2027.The acquisition strengthens Sun Pharma’s global footprint and product portfolio, particularly in women’s health and biosimilars.Post-integration, the combined entity is expected to generate revenues of about $12.4 billion, placing it among the world’s top 25 pharmaceutical companies. The deal also accelerates Sun Pharma’s push towards innovative medicines, which are projected to account for 27% of the merged entity’s revenues.Organon, spun off from Merck & Co (known as MSD outside the US and Canada) in 2021, operates across 140 countries with a portfolio of over 70 products spanning women’s health, biosimilars and general medicines.It reported revenues of $6.2 billion and adjusted EBITDA of $1.9 billion for CY2025.Strategically, the transaction gives Sun Pharma entry into the global biosimilars segment as a top 10 player, alongside strengthening its presence in established brands and branded generics. The combined company will also emerge among the top three players in women’s health globally, providing a platform for future growth.Sun Pharma plans to fund the acquisition through a mix of internal accruals and committed bank financing. Post-deal, net debt to EBITDA is estimated at 2.3x, with management indicating strong cash flow generation to support deleveraging.Dilip Shanghvi, Executive Chairman of Sun Pharma, said, “This transaction represents a significant opportunity for Sun Pharma to build on its vision of Reaching People and Touching Lives. Organon’s portfolio, capabilities and global reach are highly complementary to our own, and we believe that bringing the two organizations together can create a stronger and more diversified platform. We have deep respect for Organon’s mission and look forward to building on its legacy while driving sustainable long-term growth.“MD Kirti Ganorkar highlighted integration discipline and revenue synergies as immediate priorities. “This transaction is a logical next step in strengthening Sun Pharma’s global business. Together, we will become a partner of choice for acquiring and launching new products. Our immediate priorities will be business continuity, disciplined integration and responsible value creation. We see strong potential in leveraging Organon’s talent pool. In addition, there is scope for synergies, including significant revenue upside opportunities to be realized over the coming years,” he said.For Organon, the deal offers shareholders immediate cash value following a strategic review. The company carries debt of $8.6 billion and had a cash balance of $574 million as of end-2025.Advisory firms on the deal include JP Morgan and Jefferies for Sun Pharma and Morgan Stanley and Goldman Sachs for Organon, alongside legal counsel across jurisdictions.
