Astorg investment in Nordic’s ERT values eClinical company at $3.8 bln

Astorg has joined eResearchTechnology’s existing investor base in a transaction valuing the fast-growing clinical trial technology company at approximately $3.8 billion, Buyouts has learned.

The Paris buyout firm joins Nordic Capital and Novo Holdings A/S, both of which have stayed on as investors in Philadelphia, Pennsylvania-based ERT, alongside management.

Nordic, which initially invested through Fund VIII, has re-invested in the company through Fund IX, a Monday announcement said.

With an enterprise value of $3.8 billion, the transaction equates to an Ebitda multiple of around 18x, based on the asset’s appropriately $210 million in Ebitda, according to sources.

That also implies ERT’s value has more than doubled in about three-and-a-half years, as Nordic and Novo bought the company from Genstar Capital for an enterprise value of $1.8 billion.

Nordic took control of 70 percent of ERT’s equity in connection with the May 2016 transaction, while Novo A/S held the remaining 30 percent, an announcement said at the time.

Astorg and Nordic now own equivalent controlling stakes in ERT, while Novo is a minority shareholder, a source said.

Nordic did not conduct a formal sales process for ERT, however the company did engage in broader discussions with other parties, having received a significant level of unsolicited inbound interest, another source said.

ERT operates in a segment of the broader pharma services industry known as the eClinical space, offering technology and data to minimize risk and uncertainty in clinical trials. ERT’s tech and services help clients manage and improve the efficiency of the drug development process via electronic Clinical Outcome Assessments (eCOA), cardiac safety solutions, imaging and respiratory solutions, trial oversight, among other things.

The company is led by President and CEO James Corrigan, who formerly headed GE Healthcare’s surgery business.

ERT has supported more than 50 percent of all FDA drug approvals in the U.S. over the last five years, the Monday announcement said.

ERT’s revenue has doubled since Nordic and Novo’s 2016 investment, fueled by its focus on operations and strategic M&A, the statement said.

Jefferies advised ERT on the transaction.

For Astorg, the transaction follows its investment in Nemera, a French manufacturer of drug delivery devices for the pharma, biotech and generics industries.

Nordic this summer bought ArisGlobal in a deal valuing the drug-safety software company just south of $800 million, Buyouts reported. The investment was made through Fund IX, which raised just over 4.3 billion euros in May 2018.

The transaction followed Nordic’s January purchase of Holt, Michigan-based Orchid Orthopedic Solutions from Altor Equity Partners. The deal was anticipated to command a valuation as high as $1 billion, sources told Buyouts ahead of the transaction.

Astorg, Nordic and Novo declined to comment.

Action Item: Check out Astorg’s latest Form ADV: