Shares of North Carolina clinical research organization PPD (NYSE:PPDI) climbed on reports that the company is for sale.
PPD shares are trading at $32.35 on Monday morning, up more than 16 percent over Friday’s close. Shares later leveled off at $30.92 cents per share. The Wall Street Journal cited unnamed “people familiar with the matter” in reporting on Sunday that Wilmington, North Carolina-based PPD is exploring a sale. The Journal said the CRO could attract interest from private equity as well as other CROs.
PPD is the third-largest CRO by revenue with $1.4 billion in 2010 sales, behind just Covance (NYSE:CVD) and privately held Durham, North Carolina-based Quintiles. The Journal also said that PRA International, a Raleigh-based CRO that is smaller than PPD but still among the CRO industry’s top 10, is being shopped around. PRA is owned by private equity firm Genstar Capital, which took the formerly public company private in 2007 in a $797 million deal. The Journal said that Genstar hopes to bring in more than $1 billion from a sale.
North Carolina CROs have been active in M&A this year. The biggest deal so far has been Raleigh-based INC Research‘s $232 million acquisition of Cincinnati, Ohio CRO Kendle, which broadens INC’s global footprint. INC in June also acquired Australia-based CRO Trident Clinical Research.
Here are some other CRO deals that have taken place so far in 2011.
- Private equity firm Nautic Partners acquires Pennsylvania CRO Omnicare CR in April.
- Clinipace Worldwide, based in Morrisville, North Carolina, buys Swiss CRO PFC Pharma Focus in May.
- Private equity firm CCMP Capital pays a reported $600 million to buy a majority stake in Cincinnati, Ohio CRO MedPace in May.
- Private equity-owned CRO inVentiv Health in July completes its acquisition of CRO PharmaNet. Financial terms were not disclosed. The deal is inVentiv’s third 2011 acquisition. In February, inVentiv acquired Raleigh consulting firm Campbell Alliance; in June, inVentiv acquired i3, another CRO.
