PRA International is sticking with private ownership after announcing that funds managed by investment firm KKR will acquire the US-based clinical research organisation from Genstar Capital.
Previously PRA had dangled the possibility of going public. In late May it filed a confidential draft registration statement with the US Securities and Exchange Commission for a potential initial public offering (IPO) of its common stock.
Subsequently, though, three private equity firms – including KKR & Co – were reported to be considering bids for PRA International, with Reuters suggesting that a sale could raise as much as US$1.3 billion.
While no financial details were released on the deal with KKR, US$1.3 billion is the price being quoted in media coverage of the transaction.
The acquisition, which is subject to regulatory approvals and other standard closing conditions, is expected to be completed in the third quarter of 2013.
Colin Shannon, president and chief executive officer of PRA, said the deal “marks the next stage of our evolution. With KKR as our new partner, we look forward to working with them to accelerate our innovation and growth while continuing to make a difference not only for our clients but also for our people”.
Jim Momtazee, KKR member and head of the firm’s healthcare investing team, described PRA as one of the fastest growing companies in the CRO sector, known for its strong client relationships and differentiated therapeutic expertise.
“PRA management and KKR share the common ambition of building on this platform by continually improving service offerings to clients and providing compelling career opportunities for employees,” Momtazee commented.
PRA International has over 5,300 employees spread over more than 50 offices worldwide. Since 2000, the CRO has conducted around 2,000 clinical trials in over 80 countries on behalf of more than 300 clients.
The company was publicly owned for a while: an IPO of its common stock in November 2004 brought in around US$100 million.
By July 2007, though, PRA was in choppy waters financially and had decided to put itself back in the hands of its one-time majority shareholder, Genstar Capital.
A private equity firm that still owned 12.8% of PRA’s shares at that point, Genstar originally acquired PRA in consortium with the latter’s management from The Carlyle Group in July 2001.
Genstar subsequently reduced its holding but retained close links with PRA when the CRO floated.
Since going private, PRA has been the subject of repeated rumours that Genstar had put it up for sale.