Triton Strikes £1.2 Billion Deal for U.K. Pharma Group Clinigen

(Bloomberg) -- Triton Investment Management Ltd. agreed to buy Clinigen Group Plc, the U.K. pharmaceutical company targeted by activist Elliott Investment Management earlier this year. 

Clinigen shareholders will receive 883 pence a share, equivalent to 1.2 billion pounds ($1.6 billion) in cash. This reflects a 41% premium to the price before news of talks emerged, according to a statement Wednesday. A previously declared final dividend will also be paid out. 

Shares in Clinigen rose as much as 11% to 910p in London Wednesday, trading above the offer price which can indicate the market expects a rival bidder could emerge. 

Earlier this year, Elliott, one of the world’s most feared activists, disclosed a 5% stake in Clinigen, pushing for the break-up of the company and the sale of its pharmaceuticals division, according to a report by Sky News at the time. Elliott holds a stake of close to 8%, according to Bloomberg data, making it the largest shareholder.

Clinigen acquires the rights to niche commercial drugs and expands their distribution. It also helps patients get access to treatments that aren’t licensed in their countries. The company has a separate division providing services to drugmakers running clinical trials, helping with areas such as packaging, distribution and medicine sourcing. 

The company has long been seen as a takeover target for buyout firms. In June, Clinigen plunged when it gave lower-than-expected earnings guidance following delays to clinical trials and disruption to oncology treatments. 

Triton is a European private equity firm with a history of investing in healthcare, including in pharmaceutical companies. It said it has been following Clinigen for a long time and the company “performs an important role in providing medicines around the world for patients with unmet needs.” 

Analysts said the offer price is fair but said there may be a debate around several potential options related to cancer drug Proleukin. 

“The timing of the bid looks opportunistic,” as the current offer does not reflect any value on the potential rejuvenation of Proleukin, said Max Herrmann, an analyst at Stifel.

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