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Cambrex to be bought by international investment firm for $2.4 billion

Cambrex to be bought by international investment firm for $2.4 billion
The Cambrex Corp. in Charles City. Press file photo by Bob Steenson
By Bob Steenson,

Cambrex Corp. announced Wednesday that it has signed an agreement to be acquired by an international investment firm for approximately $2.4 billion.

The sale, which is expected to be completed in the fourth quarter this year, is to Permira, a private equity firm with headquarters in London and offices in New York, Tokyo and Hong Kong.

The sale is expected to be completed in the fourth quarter this year.

Cambrex Corp. is the owner of Cambrex Charles City, one of the company’s 13 locations worldwide.
Joe Nettleton, the president of the Drug Substance Business Unit which includes Charles City as well as Cambrex sites in Sweden, Germany and Estonia, told the Press that Permira has a history of investing in growing companies that are leaders in their market, like Cambrex.

“Growth plans for the sites including Charles City were shared with Permira as part of the discussions leading up to today’s announcement,” said Nettleton, who lives in Charles City and was the Charles City site leader and vice president of U.S. operations before his current position.

Cambrex Charles City employs almost 400 people on its 45-acre site in the industrial park in the southwest part of the city.

In April it completed construction on a $24 million expansion to increase the type and amount of potent pharmaceutical ingredients it could manufacture.

That 4,500-square-foot project was just the latest in string of additions and improvements at the Charles City site that included a $50 million production and warehouse expansion completed in 2016.

Under the terms of the merger agreement, Cambrex shareholders will receive $60 in cash for each share of Cambrex common stock, which represents a 47.1% premium to the Tuesday closing stock price and a 37.3% premium to the 60-day volume weighted average closing price, according to a press release.

Cambrex stock closed at $60 Wednesday, up $19.23 from its close Tuesday at $40.77.

Cambrex, which has its headquarters in New Jersey, has grown to become the premier contract development and manufacturing organization in the small molecule pharmaceutical space over the last several years, according to the press release from the companies.

Acquisitions of Halo Pharma in 2018 and Avista Pharma Solutions in 2019 added drug product manufacturing and early stage and analytical testing services to the company’s leading position in drug substance manufacturing, allowing Cambrex to broaden customer relationships over the full product lifecycle, from pre-clinical through commercial.

“We are excited to announce this transaction with Permira, a global private equity firm that has made significant investments in the pharma services space,” said Steve Klosk, president and CEO of Cambrex.

“This agreement is a strong endorsement of our strategy and represents significant value for our shareholders,” Klosk said. “Cambrex will continue to invest aggressively in our commitment to our global customer base, where we are constantly looking at ways to provide the broadest possible range of world class services.”

“We are very excited to back Cambrex in its next phase of growth,” said Henry Minello, principal in the Global Healthcare Group of Permira.

“Over many years, Cambrex has built a leading position with best-in-class capabilities and facilities, backed by an excellent reputation for quality and technical expertise. We look forward to partnering with Cambrex’s talented management and employees to support the growth of its integrated services offering,” Minello said.

Permira has a total committed capital of $48 billion in long-term investments in the fields of technology, consumer, financial services, industrial tech and services and health care, according to a press release.