Surrey-based Ergomed to be bought by private equity in £703m deal

Pharmaceutical services company Ergomed is be delisted from the stock exchange and brought into private equity ownership. 

London-headquartered Permira is to acquire the Guildford firm under the vehicle Eden AquisitionCo in deal which values each share at 1,350 pence and puts the total value of the company at £703.1m.

The agreed deal value is 24 times the company's adjusted EBITDA of £28.4m with the transaction expected to be completed by the end of the first quarter of next year. 

Ergomed provides specialised services to the pharmaceutical industry and employs more than 1,500 people globally and operates out of 20 offices across the globe, providing its services in around 100 countries in total.

READ MORE: Guildford-based Ergomed reports solid first half performance

John Dawson, Senior Independent Director of Ergomed said: "The Ergomed Board is pleased to have had a proven track record of consistently delivering on its growth strategy through organic growth, geographical expansion and an effective acquisition strategy.

"While this strategy is anticipated to generate substantial long-term value for shareholders, we also note that the next phase of growth will require investment into the commercial expansion and technological transformation of the business as well as additional capital to undertake transformational M&A.

"The offer from the Permira Funds, which follows multiple rounds of negotiations and extensive discussions on valuation, represents a highly attractive valuation and offers shareholders the certainty of cash today. The Acquisition also fairly reflects the exceptional quality of the Ergomed business, its people and its future prospects. Under the Permira Funds' private ownership, Ergomed will be able to pursue its organic growth strategy, while benefiting from the expertise and capital to accelerate its acquisitive growth plan. Accordingly, following careful consideration, the Board intends to recommend unanimously that Ergomed Shareholders vote in favour of the Acquisition."

Permira said it had made the acquisition as Ergomed is operating is grwith markets  and it would further support the company through investment and acquisitions. 

Silvia Oteri, Partner and Head of Healthcare at Permira said: "We are delighted to be announcing this recommended cash acquisition of Ergomed, a high quality, medic-led and fast growing pharma services platform. We look forward to partnering with the Ergomed management team in accelerating Ergomed's growth and fulfilling its vision of becoming the leading pharmacovigilance and rare disease clinical development partner to pharma and biotech clients to safely commercialise complex and often life-saving therapies for patients. Miro and his team have built a very strong foundation and as we look to the next phase of Ergomed's growth, we will continue to support commercial expansion, new capabilities and technological innovation, via investments into the business as well as transformational M&A."

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