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Quintiles Transnational Corp. Talking to Banks About an IPO



1/28/2013 7:26:46 AM

Quintiles Transnational Corp, the largest provider of contract research for the pharmaceutical and biotechnology industries, is speaking to banks about a potential initial public offering, two people familiar with the matter said on Friday. Quintiles has held "bake-off" talks with banks this week to appoint bookrunners for an IPO, the people said on condition of anonymity because the discussions are confidential. JPMorgan Chase & Co (JPM.N) and Deutsche Bank AG (DBKGn.DE) are among the banks vying for a role, one of the people added. Private equity firms Bain Capital LLC and TPG Capital LP became the lead investors in Quintiles in January 2008 after One Equity Partners sold its stake in the Durham, North Carolina-based company. Britain's 3i Group Plc (III.L) and Singapore's Temasek Holdings are also investors in Quintiles. "Quintiles routinely evaluates its capital strategy, and it is our policy not to comment on these matters," Quintiles spokesman Phil Bridges said. Bain and TPG declined to comment while 3i and Temasek did not immediately respond to a request for comment. JPMorgan declined to comment and Deutsche Bank did not respond to a request for comment. Regulatory filings from publicly listed 3i show that the private equity firm valued its 7 percent stake in Quintiles at 109 million pounds at the end of March 2009, implying an equity value for Quintiles of 1.56 billion pounds ($2.46 billion). By the end of March 2012, 3i valued its stake, that had dropped to 4.9 percent, at 86 million pounds, implying an equity value for Quintiles of 1.76 billion pounds ($2.77 billion). Nevertheless, an IPO could value the company substantially above or below such mark-to-market estimates. Quintiles refinanced a $2 billion loan in December on more favorable terms and also took on $475 million in new debt earlier in 2012 to pay dividends to its private equity owners, according to notes by credit rating agencies. Quintiles relies on pharmaceutical companies outsourcing more of their non-core research functions. It recorded net service revenue of about $3.5 billion for the 12 months to the end of June 2012, according to Moody's Investors Service Inc.

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