Sun Pharma Stock Climbs Over 9% After $11 Bn Organon Deal Announcement

The stock of Sun Pharma on Monday traded higher by up to 9 percent on the bourses after the company announced the acquisition of the United States-based Organon & Co in an all-cash deal valued at an enterprise value of $11.75 billion, the largest deal in the Indian pharma sector.

The stock of India’s largest pharma company by revenue opened just 0.8 percent higher at Rs 1,632.50 compared to the previous close of Rs 1,619.95 apiece.

The stock soon surged to Rs 1,766.65 apiece, which was over 9 percent higher than the previous close.

The acquisition of Organon improved investor sentiment towards the Indian major. The deal is expected to give a fillip to the global operations of Sun Pharma.

Organon is a leading name in the women’s health segment. According to the investor presentation of Sun Pharma, the US-listed company is the number two player in contraceptives and number three in fertility-related medicines.

Sun Pharma currently deals in medicines related to dermatology, ophthalmology, and onco-dermatology.

The women’s health market is currently valued at around $35 billion, with a compound annual growth rate of 6-10 percent.

The company expects that the acquisition will help it increase its share of innovative medicines and will add women’s health as a new therapy area in the company’s portfolio.

Sun Pharma expects it to come under the top 25 pharma companies of the world.

Organon has operations in more than 140 countries, with a portfolio of over 50 established brands and a growing biosimilars business.

After the acquisition, the combined entity will generate an annual revenue of $12.4 billion, which is almost double Sun Pharma’s standalone $6.2 billion revenue in FY25.

According to Sun Pharma, the deal will be financed through a mix of $2–2.5 billion of cash on its balance sheet and $9.25–9.75 billion of committed bank financing.