Hard on the heels of Quintiles’ successful return to public ownership, US-based contract research organisation (CRO) PRA International is sounding out prospects for its own initial public offering (IPO) of common stock.

The move comes in the form of a confidential draft registration statement filed with the US Securities and Exchange Commission (SEC) by PRA Holdings.

It envisages a “possible” IPO of PRA’s common stock, without specifying the number of shares to be offered or the price range for the proposed offering.

The confidential filing under Rule 135 of the U.S. Securities Act of 1933 is seen as a way of gauging market interest in an IPO without disclosing any detailed financial information. 

Market conditions

PRA said its IPO was expected to start “after the SEC completes the review process initiated by PRA’s confidential submission of its draft registration statement, subject to market conditions and other conditions”.

If the offering goes ahead, PRA intends to use the proceeds to reduce outstanding borrowings under its credit facilities, provide liquidity for existing shareholders, pay off certain fees and expenses, and to generate funds for working capital and general corporate purposes.

Second shot

Like Quintiles, which recently raised US$947.4 million in an initial public offering of 19,736,842 shares, PRA is taking a second shot at public ownership.

An IPO of PRA’s 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 rumours that Genstar had put it up for sale. The CRO made no comment on the speculation, though, and nothing came of it.

International front

PRA has been particularly active on the international front in recent years. 

Last March the company expanded its footprint in Russia and Eastern Europe by acquiring ClinStar, another US-based CRO but one focused on Phase I-IV clinical trials in the Russian Federation, Ukraine, Belarus and the Baltic States.