Mankind Pharma Ltd, one of the top leading pharmaceutical companies in India, in an effort to fund its recent Rs 13,630 crore acquisition of Bharat Serums and Vaccines Ltd (BSV),is planning to raise a sum of Rs 9,000 crore through certain debt instruments like non-convertible debentures (NCDs) and short-term commercial paper, according to The Economic Times.

With a plan of borrowing money for the next one to five years, the average combined cost of debt will come around 8.50 percent, according to the ET reports. "Most of the money will be raised from mutual funds while some insurance companies could also look to invest, especially at the longer end of the tenure," a source revealed to The Economic Times.

Apart from that, the firm, through an equity issue, is also planning to raise a sum of Rs 2,000 to 3,000 crore within this financial year. Jointly underwritten by Deutsche Bank and Barclays Plc, the total cost of the debt plan will be estimated in the next few days.

It was in May this year the firms' board gave green signal for an equity fundraising of Rs 7,500 crore. The board also agreed to increase the borrowing limit to Rs 12,500 crore.

Mankind, which is the fourth largest pharmaceutical company in India, announced in July its decision to acquire a 100 percent stake in Bharat Serums and Vaccines Limited (BSV) from the private equity firm Advent International. The company stated at that time that the BSV acquisition, its largest acquisition so far, is expected to make it establish as a market leader in Indian women's health and fertility drug market.

The company's market share in the FY24 was 8.19 percent.

"Though the company is borrowing such a huge amount from debt, the plan is to tap the equity markets again sometime later next fiscal and raise funds which will be used to repay some of the debt," a second source told ET.

Having a total debt of Rs 9 crore at the end of FY24 and with a net cash position of Rs 3,747 crore by June end, Mankind's current market capitalization is Rs 95,846 crore.

The company said it is planning to clear the debt in the next three years.