Sun Pharma announced that it has entered into a definitive agreement to acquire 100% of Ranbaxy for USD 4 billion.

Commenting on the same, Emkay Global Financial Services said, ''All stock deal (14% equity dilution) with no stress on Sun's balance sheet; acquired debt and derivative losses could also be partially offset by FTF (gDiovan & gNexium) inflows

Realizable synergies possible in each of the markets where the combined entity to be present. Sun becomes leader in  derma in US and also gets access to controlled substances

Combined FY16E sales of USD 5 billion and PAT of USD 1.2 billion to emerge as a Pharma mammoth. We are positive on the deal for Sun believing synergies could surprise in the long-run.''

It has recommended 'Buy' on Sun Pharma with target price of Rs 719 as against current market price (CMP) of Rs 572 in its report.

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