As a result, Sun Pharma’s subsidiaries have increased the equity stake to 53.2 % from about 36.7% and voting rights to 68.8 % from about 24.4 % for about US$60mn
CRISIL has reaffirmed its ratings on Sun Pharmaceutical Industries Ltd’s bank facilities and commercial paper programme at ‘AAA/Stable/P1+’ post the completion of acquisition of controlling stake in Taro Pharmaceuticals Industries Ltd (Taro Pharma). As a result, Sun Pharma’s subsidiaries have increased the equity stake to 53.2 % from about 36.7% and voting rights to 68.8 % from about 24.4 % for about US$60mn.
The acquisition of additional stake in Taro Pharma will not impact Sun Pharma’s financial risk profile as it is marked by strong liquidity with about US$870mn (Rs.40bn) of cash and cash equivalents as on June 30, 2010. Sun Pharma’s Chairman of the Board of Directors and Managing Director, Dilip Shanghvi has been appointed as the Chairman of the Board of Directors of Taro Pharma.
Taro Pharma is a multinational generics company based in Haifa, Israel with majority of its revenues derived from the US market. Taro Pharma has over 100 abbreviated new drug applications (ANDA) approvals and about 26 ANDAs awaiting approval. Taro Pharma’s product profile includes drugs across therapeutic segments such as dermatology, cardiovascular, neuropsychiatry, and anti-inflammatory care. Taro Pharma also has one new chemical entity in the Phase II clinical trial stage. In CRISIL’s opinion, the acquisition of majority stake in Taro Pharma will enable Sun Pharma to strengthen its presence in the US generics market.
CRISIL’s ratings on Sun Pharma continue to reflect Sun Pharma’s established position in the fast-growing chronic therapeutic segments in the Indian market, strong profitability, and healthy financial risk profile. These strengths are partially offset by the intensifying pricing pressure, and legal and regulatory risks faced by Sun Pharma in the regulated generics market.
CRISIL expects Sun Pharma’s credit risk profile to remain stable over the medium term on the back of its strong market position in the Indian market, growing presence in the international generics market, and high profitability. The outlook could be revised to ‘Negative’ in the event of any significantly large debt-funded acquisition, vitiating the healthy capital structure, or in case of an adverse impact of the US FDA action on the revenues and profitability of Sun Pharma’s US operations.
CRISIL has reaffirmed its ratings on Sun Pharmaceutical Industries Ltd’s bank facilities and commercial paper programme at ‘AAA/Stable/P1+’ post the completion of acquisition of controlling stake in Taro Pharmaceuticals Industries Ltd (Taro Pharma). As a result, Sun Pharma’s subsidiaries have increased the equity stake to 53.2 % from about 36.7% and voting rights to 68.8 % from about 24.4 % for about US$60mn.
The acquisition of additional stake in Taro Pharma will not impact Sun Pharma’s financial risk profile as it is marked by strong liquidity with about US$870mn (Rs.40bn) of cash and cash equivalents as on June 30, 2010. Sun Pharma’s Chairman of the Board of Directors and Managing Director, Dilip Shanghvi has been appointed as the Chairman of the Board of Directors of Taro Pharma.
Taro Pharma is a multinational generics company based in Haifa, Israel with majority of its revenues derived from the US market. Taro Pharma has over 100 abbreviated new drug applications (ANDA) approvals and about 26 ANDAs awaiting approval. Taro Pharma’s product profile includes drugs across therapeutic segments such as dermatology, cardiovascular, neuropsychiatry, and anti-inflammatory care. Taro Pharma also has one new chemical entity in the Phase II clinical trial stage. In CRISIL’s opinion, the acquisition of majority stake in Taro Pharma will enable Sun Pharma to strengthen its presence in the US generics market.
CRISIL’s ratings on Sun Pharma continue to reflect Sun Pharma’s established position in the fast-growing chronic therapeutic segments in the Indian market, strong profitability, and healthy financial risk profile. These strengths are partially offset by the intensifying pricing pressure, and legal and regulatory risks faced by Sun Pharma in the regulated generics market.
CRISIL expects Sun Pharma’s credit risk profile to remain stable over the medium term on the back of its strong market position in the Indian market, growing presence in the international generics market, and high profitability. The outlook could be revised to ‘Negative’ in the event of any significantly large debt-funded acquisition, vitiating the healthy capital structure, or in case of an adverse impact of the US FDA action on the revenues and profitability of Sun Pharma’s US operations.
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