Sun Pharma to acquire Ranbaxy in $4 billion all-stock deal

Drug major Sun Pharmaceutical Industries on Monday said it will acquire Daiichi Sankyo-owned Ranbaxy Laboratories in an all-stock transaction totalling equity value of USD 3.2 billion. Taking Ranbaxy’s debt into account, the transaction is worth over USD 4 billion(Rs. 24,000 crore at 60 rupees to the US dollar). The deal between the two companies, both rapped by the USFDA over quality issues, will create world’s fifth-largest generic drugmaker entity.

“Ranbaxy has a significant presence in the Indian pharma market and in the US where it offers a broad portfolio of ANDAs and first-to-file opportunities. In high-growth emerging markets, it provides a strong platform which is highly complementary to Sun Pharma’s strengths,” Dilip Shanghvi, Managing Director of Sun Pharma said in a release.

“Sun Pharma has the API (Active Pharmaceutical Ingredients) plant to supply material to Ranbaxy’s US plant,” Ramesh Adige, former executive director of Ranbaxy told NDTV.

Ranbaxy shareholders will receive 0.8 share of Sun Pharma for each share of Ranbaxy. The exchange ratio represents an implied value of Rs. 457 for each Ranbaxy share.

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