UK mid-market private equity investor LDC has backed the management buyout (MBO) of Fishawack Group, a provider of scientific communications services to global pharmaceutical companies.
The deal values the business at GBP38 million and LDC has committed further equity to accelerate Fishawack’s growth strategy, including potential acquisitions. It represents a strong exit for Growth Capital Partners (GCP) who supported the management team in a secondary buyout in 2013.
Founded in 2001 by Oliver Dennis and Dominic Miller, who will both continue to lead the business, Fishawack provides fully-integrated, cross-border services to global pharmaceutical organisations. It provides a variety of medical communications, market access and pharmacovigilance services to clients to drive the commercialisation of drug compounds. Its services are typically provided from phase II/III clinical trial stage through to post-approval and last for the full lifecycle of the patents on compounds.
Headquartered in Knutsford, Cheshire, the business employs more than 230 people and operates across three sites in the UK, two in the US and one in Switzerland. It is contracted with 15 of the world’s top 20 pharmaceutical companies, including GSK, Sanofi and Novartis.
The investment is a tertiary buyout and will enable the management team to accelerate its buy and build strategy through a number of targeted acquisitions over the medium term, in addition to supporting the growth of current client relationships.
Dennis says: “With GCP’s support we have made significant progress with our growth strategy over the past few years and bringing LDC alongside us will enable us to build on this further as we aim to create the largest independent player serving the growing global medical affairs market. We have completed six acquisitions since inception and three with GCP, which has seen us bring in additional expertise, while also enhancing our geographical footprint in the key US market.
“We are an ambitious team and want to build on this further, continuing to strengthen our market-leading proposition and further building our presence internationally. In LDC we have a partner that is not only able to provide the financial backing we need to do this, but one that also has a strong track record in the pharmaceutical sector.”
Garrett Curran, managing partner at GCP, says: “We are delighted to have worked with the Fishawack management team over the last four years and after supporting three strategic acquisitions, to see the group more than double in size. We wish the team all the best for the future as they move to the next stage of their growth strategy and build scale across the impressive international group.”
The transaction was led by Simon Braham and Jonathan Bell at LDC in Manchester, and both will join the board as non-executive directors.
Braham (pictured) says: “Global pharmacos continue to invest heavily in the research and development of new drugs, and with treatments and applications becoming increasingly complex there is a need to further educate healthcare professionals to ensure the efficacy, safety and ultimately benefits of new drugs are thoroughly understood, which help to make improved prescribing decisions to help patients. Fishawack is very well-placed to meet this need and with the medical affairs industry valued at GBP6 billion per year – almost 50 per cent of which is outsourced – there is a clear opportunity to capitalise on.
“For us, it’s not just about market opportunity but backing the management teams at the driving wheels of the businesses we invest in. Oliver and Dominic have built a leading proposition and we’re looking forward to supporting them as they continue to build the business further.”
This deal marks the second investment of 2017 so far for LDC’s Manchester office and closely follows its support of pharmaceutical components manufacturer ChargePoint. It is also the fifth investment in the past eight months for the team, which has backed technology companies Mitrefinch and Giacom, and business services firm Ellis Whittam.
Bell says: “Fishawack is LDC Manchester’s fifth deal over the last eight months, which has seen us invest over GBP100 million of equity and follows over GBP275 million of exit proceeds the team has generated over the same period. We are committed to invest at least GBP100 million of equity in 2017, and investing in Fishawack, following ChargePoint earlier this month, underlines our intentions for the year.”
LDC’s Manchester office has also generated more than GBP275 million of exit proceeds since June, having exited investments in Synexus, one of the world’s largest clinical trials patient recruitment firms, contract catering firm Waterfall and restaurant group New World Trading Company.
Fishawack and GCP were advised by BDO (Ruth Percival), with legal advice from Hill Dickinson (Craig Scott and Michael Murphy).
LDC was advised on its investment by Clearwater International (Carl Houghton, Wesley Fell-Smith, Dan Rossington, Mark Taylor, Tom Barnwell, Kirsten Handley and Emma Rodgers), with legal advice from Addleshaw Goddard (Paul Medlicott and George Danczuk) and Tax advice from KPMG (Steven Heath and Chris Wilson).
Debt facilities were provided by European Capital.
