SBI is all set to join global lenders in Sun Pharma’s mega acquisition, signalling a new phase in Indian banks backing large overseas corporate deals.
As per reports, the State Bank of India (SBI) is preparing to commit up to $1 billion toward financing Sun Pharmaceutical Industries’ acquisition of the US-based drugmakerOrganon, a deal valued at approximately $11.75-12 billion. If approved, the funding would place India’s largest public-sector bank among a consortium of international lenders supporting one of the biggest overseas acquisitions ever undertaken by an Indian pharmaceutical company.
The proposal is currently awaiting internal approvals, but its importance extends beyond the transaction itself. Industry observers view the move as a sign that Indian state-owned banks are becoming increasingly willing to participate in large-scale acquisition financing, an area traditionally dominated by foreign financial institutions.
A transformational deal for Sun Pharma.
Sun Pharma announced its agreement to acquire Organon earlier this year in a transaction that would substantially expand its international footprint. The acquisition is expected to strengthen the company’s presence across women’s health, biosimilars, specialty medicines, and established pharmaceutical products marketed in more than 140 countries. The deal is widely regarded as a transformative step for the Mumbai-headquartered pharmaceutical giant. Analysts have noted that the acquisition could significantly increase Sun Pharma’s scale, diversify its revenue streams, and improve access to key global markets where its presence has historically been limited.
SBI’s proposed involvement comes at a time when India’s banking landscape is evolving. Earlier this year, regulatory changes enabled domestic lenders to participate more actively in acquisition financing, a segment that had long remained restricted because of concerns around asset quality and risk exposure. As a result, Indian corporations pursuing global expansion may increasingly find support from domestic financial institutions rather than relying exclusively on overseas lenders or alternative funding channels.
Growing ambitions in cross-border financing.
The reported commitment also reflects a broader trend among Indian banks to support outbound acquisitions as domestic companies seek international growth opportunities. SBI has recently explored partnerships and financing arrangements aimed at facilitating mergers and acquisitions, particularly those involving large cross-border transactions.
For India’s corporate sector, the development highlights a growing alignment between domestic financial institutions and the global ambitions of Indian businesses. If approved, SBI’s participation would not only support Sun Pharma’s largest overseas acquisition to date but could also signal a new era of involvement by public-sector banks in major international dealmaking.
