When Sun Pharmaceutical Industries secured shareholder approval in July for its $11.75-billion enterprise-value acquisition of US-based Organon, it marked more than just one of the biggest overseas acquisitions by an Indian company in recent years. The deal underscored a broader shift underway across India Inc.
The transaction also illustrates how India's outbound acquisition strategy has evolved. Unlike the overseas bets of the mid-2000s, Sun Pharma entered the deal with a net cash position, allowing it to fund a part of the acquisition through internal accruals while raising offshore financing for the balance. The combined company expects a pro forma net debt-to-EBITDA ratio of around 2.3 times and plans to deleverage rapidly using annual free cash flows of nearly $2.5 billion.
