Triton acquires Clinigen at increased GBP 1.3bn valuation

Stepstone has an indirect interest in Triley Bidco via a fund managed by Triton and is also participating in the acquisition as a passive co-investor, according to Unquote Data.

Triley Bidco will acquire the entire issued and to-be-issued ordinary share capital of Clinigen at a price of 925 pence per Clinigen share, paying in cash; the offer is final and will not be increased, according to a press release. The enterprise value multiple implied by the offer is 14x Clinigen's adjusted EBITDA of GBP 116.3m, and 19x Clinigen's free cashflow of GBP 83m for the year to 30 June 2021, noted a press release.

In December 2021, Triley Bidco made a GBP 1.2bn take-private offer for Clinigen, offering 833 pence per share, according to Unquote Data.

Elliot Management, an activist shareholder, had at the time increased its stake in the company to 10.67% after Triton had agreed to strike a deal, according to Reuters. The activist shareholder exercised pressure on Clinigen's management to break up the company, as reported.

Mergermarket reported in January 2022 that Clinigen minority shareholders were unimpressed by the low offer of 833 pence made by Triley Bidco. Shareholders told Mergermarket at the time that 990 pence per share would reflect the company's value and 930 pence per share would be realistic. 

Clinigen had previously said in statements in the summer of 2021 that it had struggled due to the impact of the pandemic, as it saw a reduction in its core cancer drug, Proleukin, due to delays in clinical trials; however, the company remained confident that it would hit an EBITDA growth in 2022 in the double-digit range.

Triley Bidco made seven different proposals while undertaking extensive due diligence, as noted in a statement. The company stated that the offer reflects the strength of the services business and also accounts for expected headwinds outlined in Clinigen's 2021 financial update.

The latest offer will allow Clinigen's shareholders to realise in cash the benefits of the application of Proleukin in a clinical trial, which may find a potential treatment that is being developed by lovance Biotherapeutics. The outcome of the trial remains uncertain for many reasons, including, as noted above, the pandemic and the recent Omicron variant. However, Triley Bidco noted in a statement that it remains confident that Clinigen can grow in the private market environment.

Furthermore, Triton will focus on creating long-term value and enabling Clinigen to expand its footprint geographically, as well as broadening its technology base. Triton believes the company should be able to be more effective in competing for inorganic growth under the GP's ownership, according to a statement.

Clinigen listed in 2012 in a GBP 135m IPO, making it the first listing of a UK pharmaceutical company in five years, according to a statement at the time.

Triton is currently investing via The Triton Fund V, which held a final close on its hard-cap of EUR 5bn in December 2018, surpassing its target of EUR 4bn. Much like its predecessor funds, the vehicle will focus on European mid-market buyout opportunities with an emphasis on northern European targets. The fund will focus on a range of different sectors like industrials, business services, healthcare and consumer. Other healthcare investments from this vehicle include Netherlands-based Bergman Clinic, which the GP acquired in March 2021; and UK-based pharmaceuticals company Atnahs Pharma in June 2019.

Company
Clinigen was founded in 2008 and is headquartered in Burton upon Trent. The company provides services and products to biotech companies, healthcare professionals and patient groups to broaden access to medicines in commercial and unlicensed markets.

Clinigen employs 1,250 people.

According to the company's annual report, it posted revenues of GBP 523.6m in 2021, up by 12% since 2020 when it reported GBP 466.7m, and GBP 456.9m in 2019.

The company reported an adjusted EBITDA of GBP 116.3m in 2021, versus GBP 129.8m in 2020 and GBP 100.8m in 2019, while net debt was reported to be GBP 335.8m in 2021, in comparison to GBP 311.9m in 2020 and GBP 252.4m in 2019.

People
Triton – Jan Pomoell (co-head of Triton's healthcare sector).
Clinigen – Shaun Chilton (CEO); Elmar Schnee (chair).

Advisers
Equity – JP Morgan Cazenove (corporate finance); Barclays (corporate finance); HSBC (corporate finance); White & Case (legal); Alston & Bird (legal).
Vendor – RBC Capital Markets (corporate finance); Numis (corporate finance); Ashurst (legal).

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• Topics
• UK / Ireland
• Buyouts
• Healthcare
• United Kingdom
• Triton Partners
• Take Private