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PPD raising $550M, hitting $9B in value after attracting two new investors

PPD

Apr, 27 2017, 3:01 PM

Life science services provider Pharmaceutical Product Development is raising up to $550 million after attracting two investors in a shift of corporate control that leaves Hellman & Friedman as the majority owner.

The moves will "drive continued strong growth," an exec tells WRAL TechWire. The CEO notes that the moves come with PPD "stronger and healthier than it’s ever been" since the company was acquired and taken private in 2011.

Rumors had circulated in 2015 that the company might be sold for around $7 billion.

The international company, which maintains a major operation in Research Triangle Park, has landed investment from an Abu Dhabi Investment Authority (ADIA) subsidiary and a Singapore sovereign wealth fund affiliate (GIC).

"After evaluating all its options, the PPD Board of Directors determined a transaction led by our existing owners was in the best interest of the company and all its stakeholders because it offers a fresh ownership structure designed to support the strategy of the company to drive continued strong growth," Elizabeth Kuronen, vice president, corporate communications for PPD, told WRAL TechWire:.

"We are excited to continue our relationship with Hellman & Friedman and Carlyle and look forward to working with our new investors, GIC and ADIA.This transaction enables the current owners and management to reinvest to drive the next phase of PPD’s growth."

Few specifics

PPD, which is privately held, declined to disclose much in the way of specific details about what it described as a "recapitalization."

However, the deal leaves Hellman & Friedman as the majority owner and The Caryle Group as a "substantial minority" ownership stake. Both companies are "investing substantial equity from new funds," the company said in a statement. Carlyly and Hellman & Friedman acquired PPD in 2011 and took the company private in a deal valued at some $3.6 billion.

New senior notes are being issued to finance the recapitalization with a goal of generating $550 million. The moves will value PPD at $9.05 billion, according to PPD.

​“PPD is stronger and healthier than it’s ever been since going private in late 2011 and has progressed its strategy to reduce the time and cost of drug development for our customers,” said David Simmons, chairman and CEO of PPD, in a statement.

“After evaluating all our options, the board determined a transaction led by our existing owners was in the best interest of the company and all its stakeholders. We are excited to continue our partnership with Hellman & Friedman and Carlyle and look forward to working with our new investors, GIC and ADIA. The PPD leadership team and our more than 19,000 colleagues around the world remain dedicated to our purpose and mission of improving health by helping our customers deliver life-changing therapies.”


Hellman & Friedman statement on the deal:

“PPD’s performance since 2011 has been exceptional,” said Allen Thorpe, managing director of Hellman & Friedman. “We are thrilled to announce this transaction and mark the beginning of the next chapter of PPD’s success. Increasing our investment reflects our confidence in the outstanding team of people throughout the company and PPD’s leadership position in the CRO industry. PPD is making the hard work of innovating new therapies easier for thousands of researchers and doctors, and we're proud to support its continued growth.”

Carlyle statement on the deal:

Stephen H. Wise, managing director and global head of healthcare for Carlyle, added, “We are proud of PPD’s accomplishments since we made our investment in 2011. PPD has strengthened its platform immensely and today is positioned as one of the most innovative CROs in the market. This new capital structure is designed to support the strategy of the company and drive continued strong growth. Carlyle is excited to remain a significant investor in PPD and support the entire PPD employee base in this next chapter.”

Source: PPD






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