Cinven Ltd said on Monday it agreed to acquire BioClinica Inc from two other buyout firms, Water Street Healthcare Partners and JLL Partners, in a deal that sources said values the U.S. clinical trials company at around $1.4 billion, including debt.
Reuters reported earlier on Monday that Cinven was nearing a deal for Bioclinica.
The sale underscores the private equity sector’s insatiable appetite for contract research organizations, which have benefited in recent years from pharmaceutical companies’ drive to cut costs, reduce clinical trial times and expand their research and development presence around the world.
It is the latest in a string of acquisitions of pharmaceutical contract research organizations by private equity firms this year.
Earlier this month, Thomas H. Lee Partners LP agreed to sell a 50 percent stake in inVentiv Group Holdings to Advent International Corp, valuing the company at $3.8 billion. In March, Genstar Capital agreed to sell another contract research organization, ERT, to Nordic Capital for $1.8 billion, including debt.
JLL Partners recently partially cashed out of another pharmaceutical services investment, Patheon NV (PTHN.N), which raised $640 million in an initial public offering in July. That company now has a market capitalization of around $4 billion.
BioClinica assists pharmaceutical companies in clinical trials, and has expertise in technologies that focus on clinical research data and analytics. It supports over 17,000 clinical trial sites in 90 countries.
JLL Partners acquired BioClinica in 2013 for $123 million. In 2014, it merged Bioclinica with CCBR-SYNARC, which was owned by Water Street. It went on to make eight more acquisitions to help boost Bioclinica’s revenues more than 60 percent in the past two years.
Cinven plans to continue to grow Bioclinica both organically and through acquisitions, it said in a statement Monday.
“We believe that Cinven will be an excellent partner with management as they continue to execute Bioclinica’s strategic plan,” said Peter Strothman, a partner at Water Street.
At Cinven, Bioclinica will be joining a large portfolio of healthcare investments, most of which are based in Europe. Cinven launched an initial public offering for another pharmaceutical services portfolio company, Medpace Inc (MEDP.O), earlier this month, raising more than $160 million.
The Bioclinica deal would be the first investment out of Cinven’s new 7 billion euro ($7.9 billion) buyout fund, which for the most part focuses on acquiring companies based in Europe.
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