CVC, GBL launch €10.7 billion bid to take Italian drugmaker Recordati private

By Elvira Pollina and Giulia Segreti

MILAN, May 22 (Reuters) – Private equity firm CVC Capital Partners and Belgian investment group Groupe Bruxelles Lambert launched a 10.7 billion euro ($12.43 billion) cash bid for Italy’s Recordati on Friday, aiming to take the company private.

Italy’s fragmented pharmaceutical sector has seen a flurry of dealmaking in recent months as companies seek to scale up, with Angelini announcing a $4.1 billion acquisition of U.S.-listed Catalyst Pharmaceuticals and Chiesi buying U.S.-based KalVista Pharmaceuticals for 2 billion euros.

CVC, which has since 2018 controlled a vehicle holding a 46.8% stake in Recordati, submitted a non-binding expression of interest at the end of March for all of the company’s shares, with the aim of delisting it.

The preliminary offer was subject to a number of conditions, including the identification of partners to support the bid, Recordati said at that time.

The CVC-GBL consortium is offering 51.29 euros per share in cash ex-dividend, a premium of 12.89% compared to Recordati’s share price on March 25, the day before the Italian company announced CVC’s interest.

“CVC and GBL will partner as co-control investors with a clear commitment to support the company’s development over the long term,” the two partners said in a statement.

The plan to take Recordati private is aimed at better exploring options, including potential new deals, across its different business lines to unlock value, a source with direct knowledge of the matter told Reuters.

Founded a century ago by Giovanni Recordati as a family pharmacy in a town in central Italy, Recordati now has businesses covering primary care, consumer health and rare diseases. It also supplies other pharmaceutical companies through its chemicals division.

A group of investors including Abu Dhabi Investment Authority (ADIA), Canada Pension Plan Investment Board and the company’s chairman Andrea Recordati will invest alongside CVC and GBL, the statement added.

($1 = 0.8610 euros)

(Reporting by Elvira Pollina in Milan and Giulia Segreti in Rome, editing by Alvise Armellini and Elaine Hardcastle)