Sun Pharma to raise $1bn via domestic debt sale for Organon acquisition

Sun Pharmaceutical Industries is set to tap India's domestic debt market to raise around 100 billion rupees ($1.04 billion) through a rupee-denominated bond sale, according to multiple sources. The fundraising exercise is designed to refinance a bridge loan the company had secured to partially fund its acquisition of Organon & Co., a US-based healthcare company.

The move represents a shift from foreign currency borrowing to domestic rupee debt, allowing the pharmaceutical company to manage its currency exposure while accessing India's substantial institutional investor base. The timing of the offering comes as Indian corporates seek to optimize their capital structures in the current interest rate environment.

Sun Pharmaceutical, one of India's largest drugmakers with significant international operations, has been expanding its global footprint through strategic acquisitions. The Organon deal marked a significant step in the company's growth strategy, strengthening its presence in the global healthcare market. By refinancing the bridge loan with longer-duration domestic bonds, the company can lock in financing for the acquisition on more favorable terms.

The transaction is expected to attract domestic institutional investors, including banks, insurance companies, and mutual funds, which have shown strong appetite for high-quality corporate debt offerings. The offering details, including coupon rates and maturity profile, are likely to be finalized in coming weeks as the company works with investment banks managing the sale.