India's Sun Pharma-Organon $10 bln deal strategic despite high leverage, say analysts

Organon & Co.

21/01/2026 07:06

** India's Sun Pharmaceutical SUN.NS has submitted a non-binding offer to acquire US-headquartered Organon OGN.N for $10 billion, Economic Times reported on Monday

** Shares of SUN down 3% since Monday

** Jefferies says the deal broadens Sun's global reach, therapy mix, manufacturing presence, and also marks entry into biosimilars

** Adds, combined entity will double its revenue; however, it will also be highly levered at ~3.3x net debt/EBITDA at upper end of valuation

** Potential deal's valuation mentioned in media reports does imply meaningful accretion for SUN earnings but the strategic rationale for the deal is key - BoFA

** Analysts have a "buy" rating on avg; median PT is 1971.50 rupees - data compiled by LSEG

** SUN down ~6% so far in January

 (Reporting by Urvi Dugar in Bengaluru)

 ((UrviManoj.Dugar@thomsonreuters.com;))