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Scoop: Court Square's Celerion hits the market

Jun 13, 2022
Illustration of falling pills surrounded by abstract shapes and sections of dollars.

Illustration: Gabriella Turrisi/Axios

Court Square Partners is seeking a buyer for pharma services company Celerion, multiple sources familiar with the matter tell Axios.

Why it matters: Sources have characterized the Lincoln, Nebraska-based company as a leader in Phase 1 studies, an area in which there is a shortage of capacity. That should prove favorable for Celerion.

  • Plus, Celerion comes fresh on the heels of a few notable trades garnering robust multiples in the broader outsourced life sciences services sector, including Emmes, Open Health and Advarra.

What's happening: A sale process has kicked off via Lazard, which advised the company five years ago when it traded hands, sources say.

  • Marketing materials have been distributed to potential buyers and bids are due at the end of June, sources say.
  • A sponsor outcome is deemed likely as the big CROs typically find Phase 1 difficult to integrate.

By the numbers: The company is projecting pro forma adjusted EBITDA for 2022 in the low $50 million range, up from just north of $40 million of pro forma adjusted EBITDA last year, sources say.

  • Revenue is expected to surpass $200 million this year and is growing at a 10% CAGR, they add.
  • Some sources suggest the process will produce a high teens multiple, while recent pharma services companies deemed scarce have commanded 20x-plus multiples.

Flashback: Court Square bought Celerion in late 2017, providing an exit for WindRose Health Investors (formerly MTS Health Investors).

Court Square declined to comment and Lazard did not return requests for comment.

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