After announcing a review of "strategic alternatives" for its contract manufacturing division back in March, Madrid-based drugmaker Laboratorios Farmacéuticos Rovi now says it has received buyout offers for the unit.
In a statement Wednesday, Rovi said it "has received from various entities non-binding offers for the acquisition of said business." The company's disclosure (PDF) came in response to press reports that the company's division was attracting buyout interest.
Specifically, Spanish newspaper Expansion reported that five bidders are angling for a potential acquisition of the Rovi contract manufacturing outfit. The report put a potential deal value at 3.5 billion euros ($3.74 billion).
Rovi announced (PDF) its assessment of “potential strategic alternatives” for the division back in March, saying it had hired financial advisory firm Lazard to help with the process.
According to Expansion, the parties with initial offers in the race are Antin Infrastructure Partners, Cinven, CVC Capital Partners, KKR and Permira, all of which are now in the due diligence stage.
“No final decision has been taken regarding the referred potential transaction nor is there certainty as to whether it will be adopted,” Rovi said in its filing. If the drugmaker does go through with a sale, the deal would need to be approved by shareholders.
Spokespeople at Civen and Permira declined to comment on the potential transaction, while Antin, CVC and KKR did not immediately respond to requests for comment.
Rovi’s CDMO business was known for linking up with Moderna in a 10-year pact to help produce COVID-19 vaccines and future mRNA-based drugs and vaccines. Through the deal, Moderna was slated to make investments in a trio of Rovi facilities to help boost capacity.
These days, while Rovi is still producing the COVID shots, demand for mRNA vaccines is nowhere near as intense as it was during the pandemic. Instead, injectable diabetes and obesity meds have taken over in popularity in many countries around the globe. While Rovi’s plants aren’t currently involved in that space, its “significant spare capacity” could be used to grow in that area, analysts at ODDO BHF wrote in a note to clients.
The ODDO BHF team estimated the value of the CDMO unit is 2.25 billion euros ($2.7 billion).
Last year, Rovi's CDMO arm generated revenue of 409 million euros ($437 million), or about half of the company's total haul of 829.5 million euros ($887 million).