As PRA mulls an IPO, three private equity heavyweights are reportedly looking to bid on the CRO, and current owner Genstar Capital could well be pushing talk of going public just to tick up the asking price.
Citing confidential sources, Reuters reports that KKR, Warburg Pincus and Cinven are considering making offers for PRA, and the final deal could come in as high as $1.3 billion. The auction is in its second round, according to the news service, and bids are due later this month. Genstar bought PRA for $797 million back in 2007, and the company aborted an attempt to sell the CRO in 2011 after buyout offers came in low.
Last month, PRA filed a confidential draft registration form with the SEC, allowing it to get the IPO process rolling without disclosing its financials. The company didn't disclose how many shares it would offer and at what price but did say it would use the proceeds to pay down debt, take care of expenses and cover general corporate purposes.
Now, however, as private equity firms queue up to take PRA off of Genstar's hands, the IPO would appear to be a last resort if again bids fall short of the company's expectations. That said, the recent high-dollar debut of Quintiles ($Q) could convince Genstar that the market is more friendly to going-public CROs than ever before, as that company hauled in $947 million in an over-booked IPO.
PRA employs about 5,000 people in more than 30 countries, and the company has been expanding its capacity abroad over the past year, acquiring Eastern European CRO ClinStar in March and launching a joint venture in China with WuXi PharmaTech ($WX), the country's largest CRO.
- read the Reuters story