3i makes a 2.3x return on the sale of Xellia

21 May 2013

3i Group plc (“3i”), and funds managed by 3i, announce they have agreed to sell Xellia Pharmaceuticals A/S (“Xellia”), a specialty pharmaceutical group focusing on the development, manufacturing and global commercialization of anti-infective therapies, to Novo A/S.  The enterprise value of the transaction is approximately US$700 million (£460 million).  In sterling terms, the total proceeds to 3i and funds represent a 2.3x money multiple on their original investment of US$208 million (£113 million).

Proceeds to 3i Group plc from today’s transaction will be c. £143 million, representing a 44% uplift against a value of £99 million at 31 March 2013.

Xellia was established in April 2008 when 3i bought NYSE-listed Alpharma Inc.'s active pharmaceutical ingredients (“API”) business with the objective of transforming Xellia from a supplier of niche APIs into a fully integrated speciality pharmaceutical company.

3i played an active role in strengthening Xellia’s Board and senior management, initially with the introduction of non-executive Chairman Peter Chambré (previously CEO of Cambridge Antibody Technology).  Working in partnership with Peter and Chief Executive Officer Carl-Åke Carlsson to develop the strategy and assemble the Board and management team, 3i subsequently introduced Andreas Rummelt (ex-CEO of Sandoz) and Benny Loft (CFO of Novozymes).

During 3i’s investment period, Xellia invested more than $100 million in research and development (R&D) and capacity expansion across its global manufacturing network, including a new fill-finish plant in Copenhagen. This investment created a platform for continued growth and enhanced margins, based on a broadened product range and an exciting pipeline of new products.  The Company’s focus on R&D, as well as new product filings resulted in 15 new filings in 2012 with up to 17 planned for 2013.

Tomas Ekman, 3i Managing Director and Partner, commented: “Over the last five years, the 3i team has worked closely with Xellia’s excellent management team to build the Company into a market leader and create a well-diversified product portfolio.  It has been a fantastic experience to work with Carl-Åke Carlsson and the management team.”

Carl-Åke Carlsson, Chief Executive and President, said: "3i’s investment and continued support, expertise and commitment has enabled Xellia to successfully grow and transition the business to become leaders in the supply of key anti-infective products.  Now, as we focus on the future and the further development of the business, including the launch of our novel antibiotics pipeline, we look forward to working with Novo and benefitting from their immense experience in the life sciences sector.”

 

For further information, contact:

3i Group plc
Kathryn van der Kroft
Tel: +44 20 7975 3021
Email: kathryn.vanderkroft@3i.com

3i Nordics
Tomas Ekman
Tel: +46 8 506 101 33
Email: tomas.ekman@3i.com

 

Notes to editors:

All sterling amounts are stated as at current exchange rates.

About 3i Group

3i is a leading international investor focused on mid-market private equity, infrastructure and debt management across Europe, Asia and the Americas. For further information, please visit: www.3i.com.

About Xellia

Xellia Pharmaceuticals is a fully integrated specialty pharmaceutical company focusing on the global anti-infective market, with over 100 years of experience and expertise in the supply of fermented and semi-synthetic finished dose products and active pharmaceutical ingredients for life-saving therapies against serious infections. The Company has growing sales in more than 70 countries to over 700 customers across the healthcare industry and for the financial year ending December 31 2012 generated revenues of US$220 million. Currently headquartered in Oslo, Norway, Xellia has global facilities including operational and manufacturing capabilities in Denmark, Hungary and China, and currently employs 900 people, of which 400 are working in Denmark.

Xellia is the world leading supplier of Vancomycin and Colistimethate Sodium (CMS) which together combat life-threatening, multi-drug resistant (MDR) bacterial infections across Gram-positive and Gram-negative species. Xellia is also developing novel antibiotics effective against MDR Gram-negative bacteria in a development project with SINTEF Materials and Chemistry (Trondheim) and the Statens Serum Institut (Copenhagen), supported by a  grant from the Research Council of Norway. Further information can be obtained at: www.xellia.com.

About Novo A/S

Novo A/S, the holding company in the Novo Group, is responsible for the management of the assets of the Novo Nordisk Foundation, which are currently valued at more than USD 30 billion.

Novo A/S is a private limited liability company fully owned by the Novo Nordisk Foundation.  Besides being the major shareholder in Novo Nordisk A/S and Novozymes A/S, Novo A/S provides seed and venture capital to development stage companies, and takes significant ownership positions in well-established companies within life science and biotechnology, as well as manages a broad portfolio of financial assets.

For further information visit www.novo.dk

 

Regulatory information

This transaction involved an investment recommendation of 3i Investments plc, advised by 3i Sweden.