PAI-backed Ethypharm acquires Martindale Pharma

Alice Tchernookova
19 January 2017

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Acquired by PAI Partners last year, pharmaceutical company Ethypharm has bolted on UK-based group Martindale Pharma.

A definitive agreement has been signed between both firms, the GP said in a statement. The combined group will generate revenues in excess of €300m, PAI said.

Martindale's CEO Michael Harris will take up the role of chief operating officer at Ethypharm as part of the transaction.

The addition of Martindale will reinforce Ethypharm's presence in the UK, the GP claimed.

Manufacturing capabilities will also be enhanced, especially for solid dose, injectables and oral liquids. The combined group will look to expand further into the fields of emergency care, pain and addiction, with plans to take its products into new markets where access to medicine needs improvement.

No new equity was added for the transaction, the GP told unquote".

Previous funding
PAI acquired French drug-maker Ethypharm from fellow private equity firm Astorg Partners in a deal reportedly valued at €725m in May 2016. The GP acquired the firm alongside the firm's management team.

Equity for the transaction was provided by PAI Europe VI, a €3.3bn fund, closed in July 2015 above its €2.5bn target. The deal reportedly valued Ethypharm at 11x its 2015 EBITDA of €66m. PAI saw off competing bids from private equity rival Bain Capital and European pharmaceutical firm Mundipharma, Reuters reported.

Astorg acquired a 60% stake in the company in 2007 via its fourth buyout fund, the €800m Astorg IV vehicle. According to unquote" data, the deal was valued in the £100-250m range, with CEO Gerard Leduc and the management team retaining a 29% interest in the company, and Intermediate Capital Group and other investors holding the remainder of the equity. In 2013, GE Capital and Ares Management provided Ethypharm with a €170m unitranche facility. GE and Ares arranged the facility via their $1.75bn European Senior Secured Loan Programme unitranche joint venture. It refinanced Ethypharm's existing debt and was earmarked to fund both R&D and future acquisitions.

Company
Based in Saint-Cloud, near Paris, Ethypharm specialises in pain and addiction treatment. It operates in 30 countries worldwide, having recently expanded into the UK with the acquisition of pharmaceuticals provider DB Ashbourne. The company also provides generic drugs to treat stomach and intestinal problems, as well as cardiovascular diseases. It currently employs 950 people and has a network of 80 partners worldwide, generating revenues of €200m.

Martindale is a speciality pharmaceutical company providing essential medicines to around 50 countries around the world, with a heavy focus on the UK and the Middle East. The group is a recognised strategic partner of the NHS and other healthcare providers, and supplies 100 licensed products.

People
PAI Partners - Frederic Stevenin, Stefano Drago (partners).