Pharmaceutical services provider Charles River Laboratories International has signed a definitive agreement to purchase MPI Research, a non-clinical contract research organisation (CRO), for around $800m.
By acquiring MPI, which provides testing services to biopharmaceutical and medical device companies, Charles River expects to grow its drug discovery and development research.
In line with Charles River’s strategy to expand biotechnology client base, the deal will bolster the firm’s general and specialist toxicology, ophthalmology, molecular biology, surgery and medical device testing capabilities.
Charles River Laboratories chairman and CEO James Foster said: “In addition to meeting our disciplined acquisition criteria, MPI is an exceptional strategic fit for Charles River because it incorporates the key attributes we require in an acquisition: access to growing end markets, high-quality services, scientific expertise, and complementary capabilities.”
Foster also added that MPI’s single-site facility in Michigan, US, will cater to the capacity requirements for both current and future need.
Furthermore, MPI will strengthen Charles River’s safety assessment network and support the firm’s long-term growth goals.
The deal is subject to regulatory approvals and customary closing conditions, and is expected to be completed in the second quarter of this year.
While MPI is estimated to record an annual revenue of about $240m for 2017, it is anticipated to add between $170m and $190m to Charles River’s consolidated revenue in 2018 and $260m to $280m in 2019.
Charles River expects to finance the acquisition and associated fees through an expansion of the company’s credit facility and cash.