Sun Pharma Gets Investment-Grade Ratings for $11.75-Billion Organon Bid

Sun Pharmaceutical Industries, India's largest drugmaker, has secured investment-grade ratings from Moody's Ratings and S&P Global Ratings for its proposed $11.75-billion acquisition of US-based Organon & Co.

The ratings were assigned as the company moves ahead with its binding bid to acquire 100% of Organon, which was announced in April 2026. S&P assigned Sun Pharma a preliminary 'BBB+' long-term issuer credit rating, while Moody's gave the company a 'Baa1' long-term issuer rating. Both rating agencies maintained a stable outlook, indicating adequate capacity to meet financial obligations with moderate credit risk.

The acquisition of Organon is expected to significantly strengthen Sun Pharma's business profile and nearly double its revenue base. S&P estimates that Sun Pharma's revenue could reach around Rs 1.3 trillion, or approximately $14 billion, by FY28, compared with an estimated Rs 645 billion, or around $7 billion, in FY27 excluding Organon.

Moody's said the acquisition would strengthen Sun Pharma's scale, geographical presence, and growth platforms, particularly in women's health and biosimilars. Organon's presence in markets such as China and Korea could also provide Sun Pharma with opportunities to cross-sell products in countries where its presence is currently limited.

The enlarged company's operating scale would become comparable with global pharmaceutical companies such as Teva Pharmaceuticals and Viatris, which generate annual revenues of about $14 billion-$17 billion. To fund the transaction, Sun Pharma has secured a $12-billion committed acquisition bridge loan from a syndicate of international banks.

The pharmaceutical major also held approximately $3.6 billion in cash as of March 31, 2026. The transaction is expected to close by March 2027, subject to regulatory approvals. Organon is expected to contribute around 40%-45% of the combined group's EBITDA following the acquisition.

The acquisition is a significant move for Sun Pharma, which has been looking to expand its presence in the global pharmaceutical market. The company's shares have been volatile in recent times, with a 6% decline after reporting a 20% decline in net profit for the first quarter.

However, the investment-grade ratings from Moody's and S&P are a positive development for the company, indicating its ability to meet financial obligations and manage credit risk. The acquisition of Organon is expected to be a game-changer for Sun Pharma, and the company's future prospects look promising.

In the context of the Indian pharmaceutical industry, Sun Pharma's acquisition of Organon is a significant development. The industry has been growing rapidly in recent years, driven by increasing demand for healthcare services and a favorable business environment.

The acquisition is also expected to have a positive impact on the Indian economy, with the potential to create new jobs and stimulate economic growth. Overall, the investment-grade ratings from Moody's and S&P are a positive development for Sun Pharma, and the company's future prospects look promising.

The significance of this development for Mumbai and India is that it showcases the growing presence of Indian pharmaceutical companies in the global market. Sun Pharma's acquisition of Organon is a testament to the company's ability to compete with global players and expand its presence in new markets.

In conclusion, Sun Pharma's securing of investment-grade ratings from Moody's and S&P is a significant development for the company and the Indian pharmaceutical industry. The acquisition of Organon is expected to nearly double the company's revenue base and strengthen its business profile, making it a major player in the global pharmaceutical market.