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Pamplona Capital Management has agreed to acquire Parexel International (Nasdaq: PRXL), a Boston-based contract drug research organization, for approximately $5 billion (including debt). The $88.10 per share price represents around a 5% premium to yesterday's closing price, but a 28% premium to where the stock was trading in May before the first reports of a sale process emerged.
- Why it's the BFD: It's one of the rare cases where private equity beat out strategics on a multi-billion dollar deal, with both LabCorp and ICON reportedly having submitted bids. Let alone against an Ireland-based company like ICON, which can build sorts of tax advantages into its bid. It's also just the latest example of activist investor success, as groups like Starboard Value had been agitating for a sale.
- Bottom line: "Parexel has just under 20,000 employees and made $605 million in revenue in the March quarter, according to its financials. But has been in the process of slimming down, as the CRO has had several rounds of job cuts since it dialed down its 2016 outlook in 2015. Those include 850 jobs announced 2015, in order to save about $20 million to $30 million a year from 2016, plus 1,100 to 1,200 worldwide announced just a few months ago, amid the buyout rumors." — Ben Adams, FierceBiotech
Venture Capital Deals
Private Equity Deals
🚑 Aileron Therapeutics Inc., a Cambridge, Mass.-based developer of cancer drugs based on a stapled peptide platform, has set its IPO terms to 3.75 million shares being offered at between $15 and $17 per share. It would have a fully-diluted market value of around $250 million, were it to price in the middle of its range. The pre-revenue company plans to trade on the Nasdaq under ticker symbol ALRN, with BofA Merrill Lynch and Jefferies serving as lead underwriters. Aileron has raised over $140 million in VC funding, from firms like Apple Tree Partners (22.4% pre-IPO stake), Novartis BioVentures (20.8%), S.R. One (10.6%), Excel Venture Management (8.7%), Lilly Ventures (7.7%) and Roche (5.3%). http://bit.ly/2sRQGVr
🚑 Dova Pharmaceuticals, a Durham, N.C.-based drug developer focused on treatments for thrombocytopenia, has set its IPO terms to 4.1 million shares being offered at between $15 and $17 per share. It would have a fully-diluted market value of around $415 million, were it to price in the middle of its range. The company plans to trade on the Nasdaq under ticker symbol DOVA, with J.P. Morgan listed as left lead underwriter. Shareholders include PBM Capital Investments (84.8% pre-IPO stake) and Perceptive Life Sciences (5.4%). http://bit.ly/2swgkN0
• CVC Capital Partners has picked advisors to sell Continental Foods, a European food company it bought from Campbell Soup in 2013 for €400 million, according to Reuters. It now could be worth more than €1 billion in a sale. http://reut.rs/2rQnaus
⚽ Providence Equity Partners has sold its equity stake in Soccer United Marketing, the media and marketing arm of Major League Soccer, back to the league. No financial terms were disclosed, although Bloomberg says that Providence has tripled the $150 million it invested for a 25% stake back in 2012 (that position was later diluted by the addition of new MLS franchises). https://bloom.bg/2sOc0LL
• FW Capital has closed its ninth private equity fund-of-funds with $350 million in capital commitments. www.fortwashington.com