AMRI Sold to PE Firms
Albany Molecular Research Inc. (AMRI) is being taken private in a deal that values the company at $922 million. The buyers, private equity firms The Carlyle Group and GTCR, are newcomers to the contract development and manufacturing organization (CDMO) space, although Carlyle also owns clinical contract research organization (CRO) PPD Inc. The investors are paying $21.75 per share, a 42% premium over the average price at which AMRI was trading prior to April 5, 2017, when news of a possible sale first broke. The deal is expected to close in the third quarter of this year.
AMRI had revenues of $570 million and a net loss of $70 million in 2016; 60% of revenues were generated from the API business, 19% from discovery and development services, 18% from manufacture of drug product, 5% from non-pharmaceutical fine chemicals, and 1% from royalties. The company has been on an acquisition spree since 2014, acquiring seven companies with combined revenues of $445 million and racking up debt of $685 million, in pursuit of the goal of reaching $1 billion in revenues by 2018. The debt load amounted to two-thirds of the company’s total capital and interest payments amounted to $40 million in 2016.
AMRI’s acquisitions enabled it to build significant positions in specialty generic APIs, custom APIs, and drug product manufacture, and gave it a significant presence in Europe. The company has also pursued proprietary product opportunities, primarily through partnering agreements with some generic companies.
This article is reprinted from the June issue of Bio/Pharmaceutical Outsourcing Report. The full article addresses the implications of selling out to two leading private equity firms. To learn more, click here.