Investment funds TPG Capital and CPP Investment Board are buying healthcare data company IMS Health for $4 billion, IMS announced.
The company, based in Norwalk, Conn., said the deal is valued at $5.2 billion including the assumption of debt. IMS expects the deal to close by the end of the first quarter of 2010. The company tracks pharmaceutical prescriptions and sales, and counts some of the largest drug developers as its clients. The data are often used by Wall Street to gauge how well a specific product is selling. IMS also provides auditing services for the health care industry along with analysis tools.
The announcement comes after weeks of speculation following media reports in October that the company was on the auction block. On Oct. 20, the company said it is exploring a variety of strategic alternatives, but did not mention the possibility of a sale. A day prior to that, media reports prompted speculation that the company could be sold to a private equity firm, potentially garnering a 30 percent premium.
IMS said the deal has fully committed financing and its board of directors unanimously approved the buyout. TPG is the former Texas Pacific Group. CPP Investment Board is one of Canada's largest pension funds. IMS shareholders are getting $22 per share under the deal, marking a 31% premium to the stock's closing price of $16.81 on Nov 4. IMS did not say whether there would be any management changes.