Sun Pharma Plans $3‑4 Billion Offshore Loans to Fund $12 Billion Organon Buyout

The Indian drugmaker’s bid for Organon would become one of the largest outbound acquisitions by a pharma firm from India. Sun Pharma is seeking to preserve its credit profile while financing a transaction that ranks among the biggest cross‑border deals in the sector. Analysts note that the deal size places Sun Pharma in a league with a handful of Indian companies that have pursued similar overseas purchases.

Sun Pharma has agreed to acquire Organon for $12 billion. It plans to raise $3 billion to $4 billion in offshore loans, supplementing $2 billion to $2.5 billion from its cash reserves. At least three banks—Mitsubishi UFJ Financial Group, JPMorgan Chase and Citigroup—have underwritten the acquisition facility and will work with Sun Pharma over the coming months on milestones such as finalizing the long‑term capital structure. The company is also exploring a consent‑based swap of Organon bondholders into Sun Pharma debt and a potential euro‑denominated bond that could be rated one to two notches higher than Organon’s pre‑deal rating. Deal approvals are expected by December. The offshore loan market has shown appetite for emerging‑market corporates, which could help Sun Pharma secure competitive rates. If the bond swap proceeds, it would reduce the need for new issuance and potentially lower overall financing costs.

The financing mix shows Sun Pharma’s effort to balance cash usage with market‑based debt to avoid overleveraging. Involving multiple global lenders signals confidence in the deal’s execution and may ease concerns about funding gaps. If the bond swap and euro bond materialize, they could lower borrowing costs and extend the debt maturity profile. The structure also aims to keep Sun Pharma’s leverage ratios within targets that rating agencies monitor. Regulators in both India and the United States will review the transaction for antitrust and national‑security considerations. Investors will watch for final loan terms, bondholder consent votes and regulatory clearances expected by December.