US-based Specialty drug company AMAG Pharmaceuticals has agreed a $700m purchase of the world’s largest newborn stem cell collection and storage company, Cord Blood Registry (CBR).
The acquisition is expected to expand AMAG’s suite of maternal health business, add enhanced commercial capabilities and future growth opportunities to its portfolio.
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AMAG chief executive officer William Heiden said: “CBR is a strong strategic fit for our maternal health business and will advance our strategy to pursue differentiated products in growing specialty markets.
“Moreover, CBR’s sophisticated, consumer-driven marketing capabilities offer a compelling opportunity to reach a broader population of expectant mothers who may benefit from our product offerings in the maternal health space, including Makena.”
CBR’s storage facility houses more than 600,000 preserved umbilical cord blood and tissue stem cell units, which represents more than half of all privately stored cord units in the US.
The newborn stem cell collection and storage company also partners with leading academic institutions that conduct clinical trials focused on evaluating the use of stem cells for regenerative medicine applications in diseases and conditions, including autism, cerebral palsy and paediatric stroke.
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By GlobalDataIn 2014, CBR generated pro forma revenue of approximately $126m and adjusted EBITDA of $45m. CBR is owned by private equity firm GTCR.
The transaction is subject to customary conditions, including expiration or termination of the waiting period under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976. It is expected to close in the third quarter of this year.
Jefferies Finance and Barclays Capital are serving as initial lenders and lead arrangers for AMAG, having granted $800m in committed debt financing for the deal.
This financing, along with AMAG’s existing balance sheet cash, will be used to fund the transaction, repay its senior secured term loan and pay fees and other expenses relating to the deal.
Deutsche Bank and Jefferies served as financial advisors to AMAG on the transaction. Goodwin Procter and Kirkland & Ellis served as legal advisors to AMAG and CBR respectively.
Image: Stem cells are being evaluated for their use in regenerative medicine applications. Photo: courtesy of dream designs / FreeDigitalPhotos.net.
