Audax Private Equity is buying Avantor’s CRO business for about $650 million.
The deal, announced Friday, is for Avantor’s clinical services business, which includes kitting, biorepository and related equipment and ancillaries. Avantor has 800 employees in its clinical services business and it’s expected to generate around $200 million in revenue this year, according to the company.
In the second quarter of this year, the segment of the business that Avantor calls laboratory solutions pulled in sales of $1.1 billion, a 3.2% decrease compared to the same time last year. The CRO business is part of laboratory solutions.
Michael StubblefieldIn a statement, Avantor president and CEO Michael Stubblefield described the move as “an important step for Avantor as we continue to optimize our portfolio in line with our new operating model,” which went into effect in January. Stubblefield added that the divestiture “enables us to enhance our focus on strategic growth opportunities in our lab and production businesses while strengthening our balance sheet.”
The company said earlier that it plans to streamline its operations and costs, and now the money from the sale is expected to help pay down Avantor’s debt.
Audax said the CRO business has 10 facilities in the US, the UK and Europe, and it also “maintains a global logistics and equipment services network.”
The deal is expected to close in the fourth quarter of this year.