Drugmaker Stada Said To Talk To Buyout Firms In €8 Billion Sale

(Bloomberg) -- Stada Arzneimittel AG has begun talking to potential buyers as the German generic-drug maker’s owners pursue a possible sale that could value the company at about €8 billion ($8.7 billion), people with knowledge of the matter said.

The early-stage suitors include Clayton Dubilier & Rice, CVC Capital and KKR & Co., the people said, declining to be identified because the information is private. Other firms looking at the business include GTCR, Canada Pension Plan Investment Board, Asia-based investment firm Hillhouse, Nordic Capital and Koch Industries, some of them said.

Stada’s management last week began a series of meetings with about 12 financial investors that will stretch into next week, the people said.  

At the same time, Stada’s owners — buyout firms Bain Capital and Cinven — also are looking into a possible initial public offering of the company, the people added. No decisions have been made and Bain and Cinven could decide to just sell a minority stake or keep Stada, some of them said. Bloomberg News reported in August that the owners were exploring options for Stada.

Representatives for Stada, Bain, Cinven, Clayton Dubilier & Rice, CVC, KKR, GTCR, Nordic Capital and Canada Pension Plan declined to comment. Hillhouse and Koch didn’t immediately reply to requests for comment.

While the owners initially aimed for a valuation of about €10 billion, some would-be buyers say a price tag of more than €8 billion, or 10 times earnings, is more realistic.

Stada spun off its large Russian operations last year as a separate business, according to a representative, a step seen as pre-requisite to selling the company because of war-related sanctions against the country. With operations across Europe, the Middle East and Asia Pacific, Stada’s earnings before interest, taxes, depreciation, and amortization rose 19% last year to €802 million.

Bain and Cinven acquired Stada in 2017 in a €5.4 billion deal that gave the private equity firms control of what was one of the last independent generic-drug businesses in Europe. The company, founded in the late 19th century and based in Bad Vilbel near Frankfurt, sells prescription pharmaceuticals and over-the-counter health products including cold treatments Snup and Grippostad.

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