(Reuters) – KKR & Co LP has agreed to acquire a significant minority stake in Arbor Pharmaceuticals LLC, in a deal that values the privately held specialty drugmaker at more than $1 billion, including debt, people familiar with the matter said on Thursday.
KKR, a New York-based private equity firm, will own more than a quarter of Arbor Pharmaceuticals under the terms of the deal, the people said, asking not to be identified ahead of an official announcement.
KKR declined to comment. An Arbor Pharmaceuticals spokesman did not immediately respond to a request for comment.
Based in Atlanta, Georgia, Arbor makes mainly branded prescription drugs for the pediatric, hospital and cardiovascular markets. It offers 16 products and has more than 40 in development, according to its website.
Reuters reported in October that Arbor was working with investment bank JPMorgan Chase & Co (JPM.N) on strategic alternatives, including a possible sale.
Arbor’s existing shareholders include Chairman Jason Wild, who runs hedge fund firm JW Asset Management LLC; Chief Executive Ed Shutter; investment firm Signet Healthcare Partners LLC; and Allen Chao, co-founder and former chief executive of Watson Pharmaceuticals Inc.
Buyout appetite from large pharmaceutical companies and private equity firms has pushed dealmaking in the healthcare sector to record levels this year. Global healthcare volume topped $364.8 billion as the number of announced deals doubled year-to-date, according to Thomson Reuters data.
Arbor is the latest minority pharmaceutical investment of KKR this year. In May, KKR took a minority stake in biotherapeutics company Coherus BioSciences Inc. Coherus went public last month last month in an $85 million initial public offering.
KKR’s current health care investments also include contract research organization PRA Health Sciences Inc and hospital operator HCA Holdings Inc.
(Reporting by Greg Roumeliotis and Olivia Oran in New York; Editing by David Gregorio)
