The funds can be used to refinance a big a part of the $1.2-billion debt raised for the acquisition of Viatris Inc.’s biosimilars enterprise, stated the sources cited above.
Lately, the senior administration of the corporate met with buyers in Singapore and Hong Kong. Biocon has indicated plans to boost between $900 million and $1 billion with a time period exceeding 5 years, stated one of many sources talked about above, though others are not sure in regards to the fundraising timeline.
Biocon Biologics chief govt and managing director Shreehas Tambe final month advised ET that the corporate is exploring methods to scale back finance prices by optimising debt compensation timelines and rates of interest.
A Biocon spokesperson declined to remark. Additionally, a Customary Chartered spokesperson declined to remark, whereas HSBC didn’t reply to requests for remark.
The corporate has already pay as you go $250 million of the $1.2 billion acquisition mortgage, as reported by ET in July. The bond has not but obtained its ranking, which can decide the pricing.
Biocon can be going through a $335 million fee to Viatris shareholders in FY25, together with $175 million tied to an choice to amass biosimilar Aflibercept. It added that it’s in a cushty place to make the stability $160 million fee.
The corporate has been making efforts to scale back acquisition-related debt as a consequence of excessive price.
In February 2023, Kotak Particular Scenario Fund invested ₹1,070 crore in Biocon Ltd to help the acquisition, adopted by a ₹500 crore funding by Edelweiss in non-convertible debentures. It had explored elevating ₹4,500 crore by NCDs however haven’t made any progress on it.
Biocon stays dedicated to lowering debt by numerous avenues, together with debt, fairness, and hybrid choices, the administration had advised buyers in earnings name lately. Regardless of manageable debt servicing, excessive curiosity prices proceed to strain profitability, with internet revenue margins at 7% for FY24.
Biocon holds a 70% stake in Biocon Biologics, whereas Viatris owns 14%. The acquisition of Viatris’ biosimilars enterprise added $1.2 billion in debt, with complete obligations reaching ₹4,800 crore beginning FY26.
Biocon Biologics contributed 57% of Biocon’s consolidated income in FY24, producing ₹8,824 crore of the corporate’s complete ₹15,621 crore.