Warner Chilcott

A consortium of investors comprising Bain Capital Partners LLC, DLJ Merchant Banking III, JPMorgan Partners and Thomas H. Lee Partners has completed the £1.615bn public-to-private of Warner Chilcott, a Northern Ireland based speciality pharmaceuticals company. The transaction was completed through acquisition vehicle Waren Acquisition Ltd, which made an offer of 862p per ordinary share, a 33% premium to the 648p the shares were trading at on 17 September 2004, the last business day prior to the announcement that the business had received an approach. The consortium paid a multiple of 20x Warner Chilcott’s earnings in the year ended September 2004. John King, the chairman, and Geoffrey Elliot, finance director, have sold nearly £130m and approximately £50m worth of shares respectively. Roger Boissonneault, who owns around £180m worth of shares in the business, has retained his position as chief executive officer of Warner Chilcott. Credit Suisse First Boston and Deutsche Bank have underwritten the debt package to facilitate the transaction. Greenhill and ABN Amro Hoare Govett ran the sale process for Warner Chilcott. The transaction took around three months to complete, finally concluding on 19 January 2005.

Company

Founded in 1968, Warner Chilcott is a speciality pharmaceutical company based in Craigavon and Rockaway in the US. The Company''s ordinary shares were listed on the London Stock Exchange and the Irish Stock Exchange in 1997 and its ADSs were listed in the US on NASDAQ in 2000. Since the acquisition of Warner Chilcott Laboratories Inc in September 2000, the business has increasingly focused its business on the women's healthcare and dermatology markets in the US. The transformation of the company's geographical focus was completed with the disposal in April 2004 of the substantial majority of the firm’s remaining UK operations. Warner Chilcott’s strategy has been to achieve organic growth of its pharmaceutical business; to research, develop and commercialise new proprietary products; and to acquire specific branded products that compliment and strengthen its existing product range. In women's healthcare, Warner Chilcott''s key products are in the areas of contraception and hormone replacement therapy. The portfolio of oral contraceptives includes the Ovcon and Estrostep brands and the portfolio of hormone replacement therapies includes Estrace, Femring and femhrt. In addition, Sarafem is a prescription treatment for premenstrual dysphoric disorder. The dermatology portfolio includes the businesses proprietary pelletised formulation of doxycycline, Doryx, the most widely prescribed branded oral tetracycline treatment for acne in the US. Dovonex, a treatment for mild to moderate psoriasis, is promoted under a co-promotion agreement with Bristol-Myers Squibb. Warner Chilcott reported operating profits of $189.9m on revenues of $522.9m in the year ended 30 September 2004. The company also reported net assets of $1,226m and net debt of $5.5m (2003: $253m) at 30 September 2004. The business employs in excess of 1,000 staff including 115 in the UK and Ireland, 582 in the US and 340 in Puerto Rico.

People

Tom Dean, managing partner of DLJ Merchant Banking Partners, and Stephen Murray, partner at JP Morgan Partners, coordinated the transaction for their respective institutions.

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• Benelux
• Healthcare