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GHO and Vistria snap up Madison Dearborn's Alcami

Nov 8, 2022
Illustration of a hand in a medical glove passing a beaker to another hand in a glove with lines through them both

Illustration: Sarah Grillo/Axios

GHO Capital and Vistria Group are joining hands to acquire Alcami, a contract development and manufacturing organization serving biotech and pharma companies, from Madison Dearborn Partners and Ampersand Capital Partners.

Why it matters: The transaction illustrates that companies perceived as high-quality, profitable and growing — buoyed by strong industry tailwinds (there are many in pharma services) — can still get financed amid the current debt drought.

Details: The new investors will assume a 50/50 controlling interest, with Ampersand and Alcami management reinvesting significant equity as part of the acquisition.

  • Terms were not disclosed, but North Carolina-based Alcami is ramping up toward $100 million of EBITDA going into next year, sources say.
  • There was not formal auction process, with the deal coming together on a bilateral basis, they say.

Flashback: Madison Dearborn in 2018 won the William Blair-run auction for Alcami, acquiring the business from Ares Capital's credit arm in 2018 at a roughly $675 million valuation.

  • Ampersand in 2020 joined as an investor via Alcami's acquisition of its portfolio company TriPharm Services.

How it works: Alcami is focused on sterile fill-finish of both biologics and small molecules, formulation development, lab services, and cGMP biostorage of high-value temperature-sensitive biologics, pharmaceuticals and materials.

  • Alcami has more than 1,000 clients globally.

What they're saying: Already an investor in three post-commercial pharma services companies, Vistria had been hunting for the right opportunity to kickstart a new platform in the clinical services space, senior partner Jon Maschmeyer says.

  • Sterile fill-finish is a high-growth market, Maschmeyer says, and in the wake of pandemic-accelerated trends including on-shoring, "we think its manufacturing space is unique."

Context: Alcami has invested $140 million-plus in capital expenditures to develop five new sterile fill-finish manufacturing lines and additional laboratory space to support both biologic and small molecule programs. 

  • Alcami has 675,000 square feet across the country.

What's next: Year one is tilted toward organic growth and ramping up its new manufacturing capacity, and then M&A could be in the cards, Maschmeyer says.

  • Alcami will consider acquisitions that expand on its core CDMO capabilities and/or those that, leveraging GHO's deep pharma services experience in the European market, give it an entry point in Europe.

Who advised: Jefferies and OES were buy-side financial advisers, while Morgan Stanley worked with Alcami.

  • Credit funds managed by Ares Management provided financing.
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