Market research giant IMS Health is to be acquired by a pair of investment houses in a deal valued at around $5.2 billion.

IMS, the world leader in providing sales analysis and medical audits to the pharmaceutical industry, has entered into a definitive agreement to be acquired by investment funds managed by TPG Capital and the Canada Pension Plan Investment Board. The deal involves a payment of around $4 billion, plus the assumption of $1.2 billion in debt.

Under the terms of the agreement, IMS shareholders will receive $22.00 cash for each share they own, representing a premium of approximately 50% over the closing share price on October 16, the last trading day “prior to public speculation that IMS was considering its strategic alternatives”. A review was indeed carried out and the latter’s board of directors have unanimously approved the transaction which has "fully committed financing". That consists of a combination of equity to be invested by TPG and CPPIB and debt financing provided by Goldman Sachs.

Chief executive David Carlucci claimed that the transaction “enables our shareholders to realise substantial value from their investment in IMS with an immediate cash premium, while at the same time strengthening our position to capture long-term growth opportunities,” He added that “with the backing of world-class private equity partners, we will continue our focus on expanding into new markets, further improving the quality and depth of offerings we deliver to our clients and playing a bigger role in the healthcare market”.

IMS, which operates in more than 100 countries, sells, among other services, information about the prescribing habits of doctors, purchased from pharmacies. It reported third-quarter revenues of $540.8 million, while operating losses, including a $106.3 million restructuring charge, were $5.5 million compared with $124.0 million operating profit in the year-earlier period.