 "Sun Pharma to raise Rs 12,000 cr through debentures, QIP route")
Sun Pharmaceutical Industries has sought shareholder approval to raise up to Rs 12,000 crore through convertible debentures or a qualified institutional placement (QIP). The funds raised will be used for expansion and acquisitions.
The company said this would allow it to strengthen its financial resources and net worth. It added its board had recommended fund-raising from domestic or international investors, factoring in significant liquidity, low interest rates, a consistent performance and a positive outlook for the sector.
Last year, Sun acquired Ranbaxy Pharmaceuticals in a $4-billion deal, making it the largest drug maker in India by sales.
Following the merger, the company has been restructuring its business and rationalising its manufacturing footprint.
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In recent months, Sun Pharmaceuticals has made two small acquisitions — buying GSK’s opiates business in Australia and specialty ophthalmic product maker Insite Vision in the US. Last month, it sold the CNS division of Ranbaxy to Strides Arcolab last month.
In July, media reports had indicated Sun planned to raise up to $1 billion by selling offshore bonds, for which it was in talks with investment bankers.
As of March-end, the company’s borrowings stood at about Rs 7,595 crore.
Separately, Sun Pharmaceuticals has also sought shareholder approval by way of a postal ballot to grant loans, provide guarantees or make acquisitions of up to Rs 50,000 crore.
Under the provisions of Companies Act, shareholder approval is required in case the value of loans, security or acquisition is more than 60 per cent of the paid-up share capital, free reserve and securities premium of the company, or 100 per cent of free reserves and securities premium.
