Private equity firm Warburg Pincus is financing a recapitalization of Sterigenics, which made a series of acquisitions in the last year focused on gamma irradiation. The deal is being done in conjunction with GTCR, another private equity group that acquired Sterigenics for an undisclosed sum.
The recap will value the company at about $2 billion and give Warburg a majority stake, according to a report from Reuters. The outlet reported in October that GTCR had hired Goldman Sachs ($GS) and Jefferies to sell Sterigenics for up to $1.5 billion.
Commenting on the deal, Warburg Pincus Managing Director Jim Neary said in a statement that Sterigenics is "a world-class sterilization company that serves a large and growing market" adding that it "fills a mission-critical need for its customers and is well positioned to benefit from the increasing demand for outsourced sterilization services."
The recap news comes after an aggressive series of acquisitions to strengthen the company. In August, Sterigenics bought Nordion for $826 million, which is it said is the world's largest provider of Cobalt-60, an isotope that produces gamma radiation. The deal makes Sterigenics the only vertically integrated sterilization services provider, the company said.
That was just one in a trio of gamma radiation deals last year. It also bought Florida-based gamma irradiation operator FTSI and Italy's main leading gamma irradiation sterilization company, Gammarad, for undisclosed amounts.
In addition to gamma irradiation, Sterigenics also offers ethylene oxide and electron beam sterilization technologies. It operates at least 44 contract sterilization centers worldwide that serve medical device, pharmaceutical and food products companies.
The latest transaction is expected to close in the second quarter, with the Warburg Pincus investment slated to come from its 11th fund. Goldman Sachs and Jefferies served as financial advisers to the deal.
"We look forward to partnering with Warburg Pincus to support the company's continued growth going forward,"GTCR Managing Director Dean Mihas said in a statement.
- here are the company and investor releases
- here is the Reuters article