Win-win deal! Sun Pharma jumps 8% in two days with Organon zooming 42% in five days - All about acquisition

Shares of US-based Organon & Co have zoomed 42% in five sessions amid pharma major Sun Pharma inking a definitive agreement to buy Organon. Organon is listed on NYSE and specialises in core therapeutic fields: reproductive medicine, contraception, psychiatry, hormone replacement therapy, and anesthesia. The stock has zoomed 41.81% to USD 13.16 in five sessions. 

The US company specialises in women’s health and was spun off from MSD (Merck Sharp & Dohme) in 2021. The company operates in more than 140 markets, with key regions including the US, Europe, China, Canada and Brazil, supported by six manufacturing facilities.

The all-cash transaction is valued at an enterprise value of $11.75 billion, marking the largest overseas acquisition by an Indian pharmaceutical company.

MUST READ | What is the Organon deal, and why are Sun Pharma's shares falling?

On the other hand, Sun Pharma shares rose 9% intraday in the previous session when the deal was announced. In the current session, the Indian pharma stock was trading on a flat note at Rs 1,735.90. Market cap of Sun Pharma stood at Rs 4.17 lakh crore. The stock has gained 8% in two days on the back of the pharma deal. 

The acquisition aligns with Sun Pharma’s strategy to expand its innovative medicines business while strengthening its presence in established brands and branded generics. The combined entity is expected to have revenues of $12.4 billion, based on FY25 for Sun Pharma and CY2025 for Organon.

Dilip Shanghvi, Executive Chairman of Sun Pharma, said the transaction provides an opportunity to build a more diversified platform. “Organon’s portfolio, capabilities and global reach are highly complementary to our own,” he said, adding that the combined entity could drive sustainable long-term growth.

Under the agreement, Organon shareholders will receive $14 per share in cash. The transaction is expected to close in early 2027, subject to regulatory approvals and shareholder consent.

For the year ended December 2025, Organon reported a revenue of $6.2 billion and adjusted EBITDA of $1.9 billion. It had debt of $8.6 billion and cash balances of $574 million.

DON'T MISS | What does Sun Pharma gain from its $12-billion Organon bid?