Sun Pharmaceutical Industries has successfully accepted bids worth ₹7,816 crore for two tranches of rupee-denominated bonds with maturities in five years and one day. According to reports from Business Standard, the first tranche offers ₹5,813 crore with a coupon of 8.20%, while the second tranche provides ₹2,003 crore with 8.05% coupon, including a put option that allows investors early redemption after 17 months. The bonds have been rated AAA by both Crisil and Icra, reflecting the company's strong credit profile. The fundraising follows Sun Pharma's board approval last week to issue non-convertible debentures worth up to ₹15,000 crore.
The bond proceeds are intended to help refinance bridge loans taken by Sun Pharma for its $11.75 billion acquisition of US healthcare company Organon. As reported by The Economic Times, the company agreed to acquire Organon in April through an all-cash transaction, marking a major expansion of its global business and women's health portfolio. Sun Pharma is expected to deploy $2.0-2.5 billion of its cash surplus and internal accruals towards the acquisition, with the balance funded through additional debt of $9.5-10.0 billion. The acquisition is expected to significantly expand Sun Pharma's global presence and strengthen its position in the women's health segment.
Institutional investors, including insurance companies, pension funds and mutual funds, are likely to participate in the bond issue. According to The Economic Times, anchor investors are expected to include SBI Pension Fund, SBI Life Insurance, ICICI Prudential Life Insurance, Aditya Birla Sun Life Insurance, ICICI Prudential Mutual Fund, Edelweiss Mutual Fund and SBI Mutual Fund. The bonds have attracted significant interest from a broad institutional investor base, including entities investing on behalf of pension subscribers and insurance policyholders. Such investors are significant participants in India's corporate bond market, particularly in longer-dated debt issued by highly rated companies.
Organon, a global healthcare company spun off from Merck, reported revenue of $6.2 billion and adjusted operating profit of around $2 billion in calendar year 2025, translating into a healthy operating margin of around 31%, according to a latest Crisil report. The acquisition is expected to significantly expand Sun Pharma's global presence and strengthen its position in the women's health segment.
The successful acceptance of bids worth ₹7,816 crore demonstrates strong investor confidence in Sun Pharma's creditworthiness and the attractiveness of the Organon acquisition financing. As reported by Business Standard, the bonds were oversubscribed with multiple merchant bankers participating in the bidding process. The fundraising follows Sun Pharma's board approval last week to issue non-convertible debentures worth up to ₹15,000 crore, with the two tranches receiving initial interest from a broad institutional investor base.
