Moody’s and S&P assign investment-grade ratings to Sun Pharma for Organon acquisition

S&P Global Ratings assigned a preliminary 'BBB+' long-term issuer credit rating, while Moody's Ratings assigned a 'Baa1' long-term issuer rating to the Indian pharmaceutical major

New Delhi: Sun Pharmaceutical Industries has secured investment-grade ratings from Moody’s Ratings and S&P Global Ratings as India’s largest drugmaker moves ahead with its proposed $11.75-billion acquisition of US-based Organon & Co.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.The ratings indicate adequate capacity to meet financial obligations, with moderate credit risk.Organon Deal Could Nearly Double RevenueThe rating actions follow Sun Pharma’s binding bid in April 2026 to acquire 100% of Organon at an enterprise value of $11.75 billion. The transaction is expected to close by March 2027, subject to regulatory approvals.S&P expects the Organon acquisition to significantly strengthen Sun Pharma’s business profile and nearly double its revenue base.Shares Of Sun Pharmaceutical Industries Tumble 6% After Company Reports 20% Decline In Net Profit For The First Quarter The agency estimates 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.Organon is expected to contribute around 40%-45% of the combined group’s EBITDA following the acquisition.Women’s Health, Biosimilars Get BoostMoody’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, S&P said.Sun Pharma Completes $347.73 Million Merger, Acquires Full Ownership Of Taro Pharmaceuticals S&P added that 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, according to Moody’s.The pharmaceutical major also held approximately $3.6 billion in cash as of March 31, 2026.

New Delhi: Rating agencies Moody's and S&P assigned investment-grade ratings to Sun Pharmaceutical Industries -- India's largest pharmaceutical company -- over the proposed USD 11.75-billion acquisition of US-based Organon & Co.S&P Global Ratings assigned a preliminary 'BBB+' long-term issuer credit rating, while Moody's Ratings assigned a 'Baa1' long-term issuer rating to the Indian pharmaceutical major. Both agencies have maintained a 'stable' outlook for the company.Also Read: Biocon signs 10-year Brazil supply deal for Pertuzumab breast cancer drugBaa1 and BBB+ are investment-grade credit ratings that indicate adequate payment capacity with moderate credit risk.The rating actions follow Sun Pharma's binding bid in April 2026 to acquire a 100 per cent stake in Organon for an enterprise value of USD 11.75 billion. The transaction is expected to close by March 2027, subject to regulatory approvals.According to S&P, the acquisition will bolster Sun Pharma's business position, almost doubling its revenue base to about Rs 1.3 trillion (around USD 14 billion) by FY28. Organon is expected to contribute 40-45 per cent of the group's EBITDA post-acquisition.Also Read: Novartis India to acquire Pfizer's 'Minipress' trademark for Rs 1,250 crore"The Organon acquisition will materially strengthen Sun's scale, geographic reach and growth platforms in women's health and biosimilars," said Kaustubh Chaubal, Senior Vice President at Moody's Ratings."The acquisition will bolster Sun Pharmaceutical's business position... We estimate Sun Pharmaceutical's revenue will increase to about Rs 1.3 trillion (about USD 14 billion) in fiscal 2028, from our estimate of Rs 645 billion (about USD 7 billion) in fiscal 2027 (ex-Organon)," S&P said in a release."In our view, this operating scale is comparable to peers Teva Pharmaceuticals Ltd. (BBB-/Stable/--) and Viatris Inc. (BB+/Stable/B), which have annual revenues of USD 14 billion-USD 17 billion," it said."Organon's presence in markets such as China and Korea offer Sun Pharmaceutical an opportunity to cross-sell its products; it currently has limited presence in the two countries," &SP said.Moody's noted that Sun Pharma has secured a USD 12 billion committed acquisition bridge loan from a syndicate of international banks. As of March 31, 2026, the company held cash balances of approximately USD 3.6 billion.