TPG completes buyout of Australia's iNova Pharmaceuticals

The size of the transaction has not been disclosed. Debtwire, AVCJ’s sister publication, reported that TPG had agreed to pay an enterprise value of AUD 2bn (USD 1.3bn) and secured a AUD 1bn unitranche debt facility from a consortium of global and local private debt funds and Asian banks.

PEP has chosen to re-invest in iNova through its sixth fund, which closed on AUD 2.5bn in 2020. The private equity originally invested in iNova – alongside Carlyle – in 2017, committing capital from Fund V. They paid USD 930m in one of the first Australian deals involving a credit fund and a unitranche-like structure. The return on the investment for Fund V is said to be approximately 2.4x.

Founded in 2006, iNova produces a wide range of prescription drugs and branded over-the-counter generics in areas including weight management, cough, cold and flu, pain management, and dermatology. The portfolio also includes health supplements and female health products. The distribution footprint encompasses 20 countries across Asia Pacific and Africa.

The company is no stranger to private equity ownership. Archer Capital and Ironbridge Capital acquired iNova for USD 349m in 2006 and exited five years later to Valeant Pharmaceuticals for USD 528m. Valeant divested the business to PEP and Carlyle to reduce its debt burden.

Dan Spira, CEO of iNova, said in a statement that TPG would help accelerate the company’s growth through channel expansion, product-in-fill opportunities, geographic expansion, and add-on acquisitions.

“Our investment in iNova is timed as the world emerges from COVID and consumers are increasingly mindful of preventative and early treatment across a range of symptoms, particularly upper respiratory, cold and flu,” added Joel Thickins, co-managing partner for TPG Capital in Asia and head of Australia and New Zealand.

“INova’s growth strategy is ideally positioned to address that growing need, with its high-efficacy brands and plans to expand meaningfully into Southeast and North Asia aligning closely with TPG’s broader strategy of building a pan-Asia platform.”

The private equity firm has previous experience turning Australia-based healthcare businesses into regional platforms. Clinical trials specialist Novetech has expanded throughout Asia and entered North America since TPG acquired it in 2017. The bolt-on of China-based PPC Group in 2020 is said to have created Asia’s largest biotech contract research organisation with full clinical services.

Earlier this year, Novotech secured USD 760m in new equity and debt financing at a post-deal valuation of approximately USD 3bn.

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• Topics
• Australasia
• Healthcare
• Buyouts
• Trade sale
• Australia
• TPG Capital
• Pacific Equity Partners
• The Carlyle Group
• Pharmaceuticals