Charterhouse takes majority stake in Serb

Alice Tchernookova
09 June 2017

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Charterhouse Capital Partners has taken a majority stake in speciality pharmaceuticals group Serb in what marks the company’s first buyout transaction.

Charterhouse is investing alongside company chair and hitherto controlling shareholder Jeremie Urbain, as well as the management team. Urbain will keep leading the group and is reinvesting "significantly" in Serb, the GP said in a statement, keeping a stake equivalent to around 40%, according to French financial publication Capital Finance.

Serb was valued at around €250m in the deal, the publication added, representing a 12x EBITDA multiple. Other bidders in the Rothschild-led auction included Permira and Apax Partners France, the publication said. Charterhouse stated it prevailed thanks to its track record in the pharmaceuticals sector with companies such as Cooper, Vemedai and DOC Generici.

Serb is the fourth acquisition completed by the GP with Charterhouse Capital Partners X, which closed at the end of last year on €2.3bn. Following the strategy set by previous generations, the vehicle invests mostly in western European businesses and is not sector-restricted. Charterhouse's transactions are typically valued anywhere between €200m-2bn.

Serb's revenues increased from €3m to €65m between 2001 and 2016. The business recently entered the US market.

Urbain decided to open Serb's capital in order to accelerate its development, the company said in a statement. The manager will continue to lead the business and reinvests significantly, together with the incumbent management team.

With Charterhouse's support, the company will aim to pursue its international expansion and will continue to acquire complementary businesses, aiming to expand into new therapeutic areas medical treatments.

Charterhouse declined to comment when contacted by unquote".

Debt
The transaction was supported by a senior B tranche arranged by BNP Paribas and ING; according to Capital Finance, leverage stands at 4.5x EBITDA.

Company
Based in Brussels, Serb produces speciality pharmaceutical products, focusing on niche branded medical prescriptions. Covered medical areas include emergency care, neurology, diagnostics and endocrinology.

While it is headquartered in Belgium, Serb is also active in Paris, London and Luxembourg and has a growing presence in the US. It registered €65m in revenues last year for a €25m EBITDA.

People
Charterhouse Capital Partners – Pierre de Sarrau, Stephan Morgan (partners); Lionel Giacomotto (managing partner).

Advisers
Equity – Ashurst, Nicolas Barberis (legal); Lazard, Jean-Philippe Bescond, Aurélien Gore Coty (corporate finance).
Vendor – Edmond de Rothschild Corporate Finance, Arnaud Petit, Grégory Fradelizi (corporate finance); HPML, Thomas Hermetet (legal); Eight Advisory, Stéphane Vanbergue, Gennat Mouline (financial due diligence).