Biocon may merge $4.5-billion Biocon Biologics with parent to unlock value, weighs options with Morgan Stanley: Report

Move could replace IPO plan amid market volatility

Biocon Ltd is considering merging its biosimilars arm, Biocon Biologics Ltd, with the parent entity, according to people cited by The Economic Times. The deal, which could value the subsidiary at around $4.5 billion, marks a shift in strategy from an earlier plan to list the biologics unit separately.

The Bengaluru-based company has reportedly entered advanced discussions with minority shareholders over a possible share swap and has also examined a cash-plus-swap structure, sources told the paper.

Moneycontrol could not independently verify the report.

Biocon chairperson Kiran Mazumdar-Shaw confirmed that the group is weighing multiple options, including an IPO, merger, or share swap, and has appointed Morgan Stanley to determine the most effective value creation route.

“The valuation we were trying to get for the IPO was under pressure because of the acquisition debt,” Mazumdar-Shaw told ET. “That is why we appointed Morgan Stanley, to say (whether) we should really do an IPO, or do a merger or something of that sort.”

She added that the board is assessing which route, a merger or IPO, could unlock value faster, given ongoing market volatility.

Biocon Biologics acquired Viatris’ global biosimilars business in 2022 for $3.3 billion, taking on about $1.2 billion in debt. That acquisition, while expanding the company’s global footprint, has since weighed on its balance sheet and IPO valuation.

As of March 31, Biocon held a 90.2 percent stake in Biocon Biologics, while the Serum Institute of Life Sciences owned 5.97 percent. Other investors include True North and Tata Capital. Goldman Sachs and Abu Dhabi’s ADQ were earlier investors in the biologics arm.

Biocon, which currently commands a market capitalisation of around Rs 54,327 crore, raised Rs 4,500 crore in June 2025 through a qualified institutional placement, its first equity fundraising since 2004, to increase its holding in Biocon Biologics and provide exits to some private equity investors.

Mazumdar-Shaw had earlier said that the timing for an IPO was 'not right' due to market uncertainty. The company, she added, is now focusing on whichever option, merger or IPO, will offer the “closest and clearest path” to unlocking shareholder value.