Penn Pharmaceuticals sale set to net LDC three times return on investment

LDC has exited a seven-year investment in Penn Pharmaceuticals by selling the healthcare-orientated business to Packaging Coordinators.

US-based Packaging Coordinators has snapped up Penn Pharmaceuticals for £127 million in a move which sees the company move from private equity to trade ownership.

The South Wales business pharmaceuticals manufacturer provides contract development and manufacturing organisation services and helps bring new products to market.

LDC first became involved with Penn Pharmaceuticals back in April 2007 when it backed a management buy-out an injected £33 million into the business. That transaction saw Gresham Private Equity exit.

Since taking on LDC as a backer, Penn Pharmaceuticals has opened a new £14 million manufacturing facility, centred on the development and manufacture of tablets and capsules, and grown turnover from £17 million to £30 million – while EBITDA has risen by 51 per cent.

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Richard Yarwood, chief executive of Penn Pharmaceuticals, says, ‘LDC’s support and strategic input to our business has been invaluable, and ensures that we are now well placed to embark upon the next stage of our growth plans.

‘The deal with Packaging Coordinators represents a great outcome for our business, providing us with a solid platform from which to build further scale in the global pharmaceutical manufacturing market.’

LDC has now completed seven exits in the last year, with other deals involving Kee Safety, Leasedrive, Benson Group and Nuclear Engineering Services. The sale of Penn Pharmaceuticals is set to net LDC a reported near 3x return on its total commitments.

Candida Morley, chief portfolio officer at LDC, adds, ‘This exit to Packaging Coordinators highlights how private equity working in partnership with a high quality management team can help to grow a business, and ensure that it is strategically positioned to embark on the next phase of its development with the right buyer.’

Hunter Ruthven

Hunter Ruthven

Hunter was the Editor for from 2012 to 2014, before moving on to Caspian Media Ltd to be Editor of Real Business.

Related Topics

Pharmaceutical industry