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ICICI Securities Report
Biocon Ltd.'s biosimilar arm Biocon Biologics Ltd. acquired Viatris' biosimilar assets to create a fully integrated global biosimilar enterprise.
Biocon Biologics will get global biosimilars business and rights in all biosimilars assets, including its in-licensed portfolio. In exchange, Viatris will receive $3.3 billion in a cash plus equity deal.
Post the deal, Biocon Biologics' net debt level will jump to $1.5 billion and net debt/Ebitda would be ~4 times. The transaction is expected to close in H2 FY23.
Implied deal valuations (excluding intercompany transactions of ~35-40%) would stand at 4.7 times-5.1 times CY23E sales.
While Biocon Biologics gets access to an established front end in the developed market, it heavily weighs on the near-term financials. Additionally, successful execution is quintessential for the transaction to be accretive.
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