Welsh Carson-backed CRO Aptuit explores sale

Welsh, Carson, Anderson & Stowe is looking to exit its more than decade-long investment in Aptuit LLC, a provider of early- and mid-phase clinical drug-development services, three sources familiar with the matter said.

The contract research organization is projecting 2017 adjusted revenue and EBITDA of $126 million and $25 million, respectively, the sources said.

William Blair and Cain Brothers are providing financial advice to the sellers on the sales process, two of the sources said.

Aptuit is being positioned to sell to a strategic, one of the sources said, noting that the EBITDA figure off which it is being marketed doesn’t account for corporate expenses. Should the company ultimately go to another sponsor, corporate expenses will need to be considered, the source noted.

A logical suitor for the asset, speculated a fourth source, might be a PE-backed strategic platform the likes of Partners Group’s PCI Pharma Services. CRO Albany Molecular Research may have also made sense as a buyer if it hadn’t just been taken private, the source added.

In the latest of high-profile CRO deals, Carlyle Group and GTCR in June agreed to take AMRI private for $922 million.

Aptuit was founded in 2004 as GPD by a group of industry experts alongside initial funding from New York’s Welsh Carson.

The company in 2011 sold its clinical-trial-supplies business to Catalent Pharma Solutions for $410 million, leaving Aptuit to concentrate on its discovery-to-mid-phase development-services business.

Aptuit in 2016 acquired early-phase CROs Exquiron and Kuecept. Terms weren’t disclosed.

Former ICON Clinical Research exec Jonathan Goldman was brought on in 2013 to take the helm as CEO.

Another former Icon exec, Peter Gray, assumed the role of chairman in November 2016. Gray, a non-executive director at Aptuit since March 2015, served as CEO of ICON for more than eight years through September 2011.

Representatives of WCAS, Aptuit, William Blair and Cain did not return requests for comment.

Action Item: Get in touch with WCAS General Partner Jonathan Rather at jrather@wcas.com

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