Case Study: Sun Pharma's Ranbaxy Acquisition, Deal Analysis

In April 2014 Sun Pharmaceutical Industries agreed to buy Ranbaxy Laboratories from Daiichi Sankyo in an all-stock deal, taking on a company whose key plants were barred from shipping to the US. It remains one of the most instructive acquisitions ever done by an NSE-listed company. This case study takes you through the deal the way an analyst would: why Ranbaxy was available at all, how the 0.8 share swap ratio set the price, what equity value and enterprise value really were once Ranbaxy's debt was counted, and how much Sun's existing shareholders were diluted. You then value a damaged asset with and without its regulatory problem, test the synergy claims, and map the risks Sun took on: plant remediation, legal overhang and integration. Finally you score the deal using EPS accretion, the share price record and return on capital, and leave with a checklist you can apply to any Indian M&A announcement using exchange filings, annual reports and screener.in.