Biocon Biologics Limited has received positive recognition from S&P Global Ratings, which placed the company on positive credit watch following its accelerated debt reduction initiatives. The rating agency's decision reflects the significant progress being made in strengthening the company's financial position through strategic restructuring.

S&P Rating Action Details

On December 10, 2025, S&P Global Ratings placed its BB long-term issuer credit rating on Biocon Biologics and the BB issuer rating on the senior secured notes issued by the company on credit watch with positive implications. The rating action underscores S&P's view that these developments represent a positive step toward retiring debt and improving the overall capital structure.

Strategic Transaction Structure

The positive credit watch follows Biocon's announcement to make Biocon Biologics a wholly owned subsidiary. The company will acquire approximately 25% stake held by minority investors in Biocon Biologics through equity share swaps. The transaction includes several key components that will significantly reshape the company's capital structure.

Biocon Limited plans to swap compulsory convertible preference shares (CCPS) held by Viatris Inc. in Biocon Biologics by exchanging them for equity shares and cash. The US$1 billion CCPS will be swapped for US$415 million worth of Biocon equity shares and US$400 million in cash. Additionally, Biocon will enable other minority investors to exit Biocon Biologics through similar arrangements.

Debt Reduction Impact

S&P Global's rationale highlights the material decline expected in Biocon's debt levels by March 2026. The rating agency treats the US$1 billion CCPS as debt-like in its financial ratios, making this transaction particularly significant for the company's credit profile.

Importantly, Biocon proposes to fund the cash consideration to be paid to Viatris entirely through fresh equity issuance of approximately ₹45 billion. The transaction eliminates other instruments that carried put options and allowed credit investors an earlier exit, which were previously viewed as debt-like by the rating agency.

Capital Structure Transformation

Proforma the transaction, S&P expects Biocon's capital structure to comprise only senior secured notes, bilateral loans, and working capital borrowings. By March 31, 2026, Biocon will have already repaid other optionally convertible debentures and redeemable non-convertible debentures issued to various investors, primarily through proceeds from its ₹45 billion equity issuance completed earlier in the year.

Credit Watch Resolution Timeline

S&P expects to resolve the credit watch on Biocon Biologics over the next 60-90 days once there is more clarity on the final capital structure and financial policy of the Biocon group. The resolution will depend on the completion of the equity issuance by Biocon to fund the cash payout to Viatris and the elimination of other debt-like instruments under the proposed transaction terms. The transaction remains pending shareholder approvals, and Biocon's ability to raise ₹45 billion through equity issuance is yet to be demonstrated.

Biocon Limited , a leading biopharmaceutical company, has successfully completed a major milestone in its strategic acquisition of Biocon Biologics Limited (BBL). On January 5, 2026, the company completed the acquisition of 33.38 crore equity shares of BBL and allotted 17.13 crore equity shares on a preferential basis to various investors, following the extraordinary general meeting held on December 31, 2025.

Transaction Completion Details

Biocon executed the acquisition in two distinct phases, combining both share swap arrangements and cash transactions:

Allottee-wise Share Distribution

The preferential allotment was executed among four key investors based on their BBL shareholding:

Mylan's SEBI Regulatory Disclosure

Mylan Inc., headquartered at 1000 Mylan Boulevard, Canonsburg, PA, has filed the mandatory disclosure under Regulation 29(1) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. The disclosure was signed by John Miraglia, President of Mylan Inc., confirming the acquisition details:

Capital Structure Transformation

The transaction has significantly enhanced Biocon's capital structure and BBL ownership:

The newly allotted equity shares rank pari-passu with existing equity shares, maintaining equal rights and privileges for all shareholders.

Strategic Rationale and Future Outlook

This acquisition represents a crucial step toward creating a fully integrated biopharma entity. The consolidation is expected to simplify Biocon's corporate structure, enable unified capital allocation strategy, and deliver operational synergies through resource consolidation. The enhanced ownership of ~94% in BBL strengthens Biocon's position in biosimilars, insulins, peptides, and generics markets.

Regulatory Compliance and Approvals

The transaction was executed pursuant to in-principle approvals issued by both National Stock Exchange of India Limited and BSE Limited dated December 31, 2025. The Fund Raising Committee meeting was conducted from 9:15 PM to 9:30 PM on January 5, 2026, ensuring all regulatory requirements were fulfilled in accordance with SEBI regulations. Out of the total approved acquisition of 14.37 crore BBL shares from Mylan for USD 400 million cash consideration, the company has completed acquisition of 7.18 crore shares for USD 200 million.