TPG inks $1.9bn pharma take-private

The firm's buyout group will acquire listed pharmaceutical company Par Pharmaceutical. TPG also has investments in several pharmaceutical companies through its TPG Biotech portfolio.

TPG Capital will purchase NYSE-listed generic pharmaceutical company Par Pharmaceutical in a deal valued at $1.9 billion.

The company develops and manufactures generic drugs and proprietary pharmaceuticals. The offer price of $50 per share represents a 37 percent premium to the company's public market closing price on 13 July. The company may solicit additional proposals until 24 August. The transaction is expected to close before the end of 2012.

“[Par] is positioned to benefit from the strong macro trends of a greater focus on cost effective healthcare solutions and the increasing demands from an aging population,” TPG partner Todd Sisitsky said in a statement.

Bank of America Merrill Lynch, Deutsche Bank and Goldman Sachs acted as financial advisors and provided financing to TPG in connection with the deal. TPG was unavailable for comment at press time.

TPG will invest through its buyout group, rather than TPG Biotech which is part of the firm’s venture capital investment platform that has invested extensively in pharmaceutical companies. TPG’s 2008-vintage TPG Partners VI buyout fund, from which capital will be drawn to fund the deal, closed on $19.8 billion.

TPG is currently in market with a number of new funds. These include: TPG Alternative & Renewable Technologies Partners Fund, which is targeting $625 million for investments in clean technology and renewable energy companies in Latin America and the Asia-Pacific region; TPG Growth II, which has a $2 billion target and will split its investments between the US and Asia; and TPG Opportunities Partners II, the firm’s credit vehicle that focuses on investments in non-performing loans, distressed-for-control and special situations on a global basis.

TPG has $51.5 billion of assets under management, with current healthcare investments in businesses including prescription drug company Aptalis Pharma, blood transfusion company Fenwal and outpatient surgery business Surgical Care Affiliates.