TLDR
- Sun Pharmaceutical Industries has reportedly submitted a $13 billion all-cash bid for Organon (OGN)
- The deal would be Sun Pharma’s largest acquisition ever, fully financed by JP Morgan, MUFG, and Citi
- OGN stock jumped ~25% on Friday, extending a 20% year-to-date gain
- Grünenthal and EQT have also reportedly made competing offers for the company
- Sun Pharma previously bid $12 billion earlier this month; the new offer marks an escalation
Organon (OGN) stock surged more than 25% on Friday after reports emerged that India’s Sun Pharmaceutical Industries is preparing a $13 billion all-cash offer for the women’s healthcare company.
The Economic Times first reported the news Thursday evening, citing people familiar with the matter. OGN jumped roughly 8% in afterhours trade before extending those gains through Friday’s session.
At the time of the initial report, Organon held a market cap of just $2.2 billion. A $13 billion offer would represent a massive premium to where the stock was trading.
The deal, if completed, would be Sun Pharma’s largest acquisition to date. The all-cash offer is reportedly fully financed by JP Morgan, MUFG, and Citi.
Sun Pharma’s plan is to fold Organon into its existing operations. It would not issue Sun Pharmaceutical stock to Organon’s current stockholders.
This isn’t Sun Pharma’s first move on the company. Earlier this month, the Indian pharma giant reportedly put in a $12 billion offer. Friday’s reported $13 billion bid marks an increase of $1 billion in just a matter of weeks.
Multiple Bidders at the Table
Sun Pharma is not alone in its pursuit of Organon. German pharmaceutical company Grünenthal and Swedish private equity firm EQT have also reportedly made offers for the company.
The competition reflects the appeal of Organon’s portfolio — a broad range of medicines and treatments focused largely on women’s health, along with its U.S. manufacturing footprint.
Organon was spun off from Merck in June 2021. Since then, the stock has had a rough ride, sitting down nearly 30% over the past 12 months despite Friday’s sharp move higher.
Trading Volume Spikes
The takeover reports triggered a wave of buying activity. Around 5.2 million OGN shares changed hands shortly after markets opened Friday — nearly matching its full three-month average daily volume of 5.9 million in just the opening hours.
Friday’s 25.47% gain pushed the stock’s year-to-date performance to a 20.25% advance.
OGN was trading above $9.20 per share in afterhours Thursday, up from a relatively depressed market cap of $2.2 billion at Thursday’s close.
No official confirmation of any deal has been made by Sun Pharma or Organon as of Friday afternoon.
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