Euticals poised to take over Archimica
Euticals, an Italian supplier of APIs, intermediates and custom synthesis services has agreed to acquire Archimica from TowerBrook Capital and Aisling Capital Partners, confirming rumours that had been circulating since November. According to the Italian business newspaper Il Sole 24 Ore, Euticals plans to raise further capital before the deal closes, which should be in February.
As of mid-January, the transaction was being described by insiders as an expression of interest but not yet a done deal. Other interested parties might also come forward. TowerBrook had reportedly been looking for a sale for about ten months. Terms were not disclosed.
The deal, if completed, will create a major player in fine chemicals, with ten sites in Europe, including six in Italy, and one in the US. The two firms said that they “expect the combination to be strategic, creating new opportunities to further develop business activities in the fine chemicals sector”.
Archimica, the former Clariant Pharmaceutical Fine Chemicals, was sold to TowerBrook in 2006. It has 550 employees and turned over €131 million in 2009, 16% up on 2008. The company added that it does not expect any change in its work with customers as a result of the change.
Euticals, which is itself owned by Mandarin Capital Partners, an Italian-Chinese investment firm, claims to be the third largest pharmaceuticals group in Italy. Its sales increased from €55 million in 2009 to €93 million last year, thanks to the acquisition of its compatriot Polichimica in March.
Archimica has a network of six sites from its heritage in Höchst and Sandoz, which pooled some considerable chemical activities into Clariant in 1998, and BTP, a highly acquisitive UK firm that was itself acquired by Clariant in 2000. The name, which belonged to one of the Italian operations of BTP, was resumed when TowerBrook took control.
Of the six sites, that at Origgio in northern Italy is described as “the heart of Archimica’s cGMP capability”, making late-stage intermediates and bulk APIs in multi-purpose facilities. It also has pilot plants, R&D, QC, and microbiology laboratories. Another Italian site at Isso was sold to Erredue in late 2009.
Archimica also owns the former Roche site at Springfield, Missouri, which now makes APIs and cGMP intermediates, as well as controlled substances under US DEA supervision. The Springfield site also houses one of Archimica’s Molecules Synthesis Centres.
The other is at Frankfurt, where the Pharmaceutical Synthesis Technology Centre houses over 60 R&D specialists working on technology development, targeted process development and broad-spectrum, small-scale manufacturing in Phases I-III. Kilo-scale production and other multi-purpose synthesis capabilities are located here.
Another site in Sandycroft, Wales, also produces bulk APIs, mostly salicylates, and carries out custom synthesis. The other two sites are at Bon-Encontre and Tonneins in the south-west of France, specialising in sterile API manufacturing using aseptic filtration technology.
Employee representative at the French sites declined to pass an opinion on the sale at a special meeting on 5 January because there was too little information. “We are still waiting. There is no information on the business plan, no industrial strategy or the selling price. We are making do with the minimum of information,” one told the local newspaper SudOuest.
Euticals, which is headed by Mauro Silvestri, dates back to 1946, with the foundation of the Istituto Chemioterapico Italiano in Lodi, near Milan, where the company is still based. It took its current name, an abbreviation of Prime European Therapeuticals in 1984, following a change of ownership, and focused operations on the manufacture of bulk APIs.
In 2001, Euticals acquired three more plants in the north of Italy. Casaletto Lodigiano, like the original Lodi site, makes general APIs and offers custom manufacturing, while Rozzano produces in small volumes for clinical development and Varese produces intermediates and APIs for anti-cancer and anti-viral therapies. Anti-depressants, anti-infectives and central nervous system are other key therapies.
The four plants were all merged into Euticals in November 2008, shortly before Mandarin took 63% ownership in a leveraged management buy out. The Carinelli family is the other major shareholder. The acquisition of Polchimica, a specialist in immunosuppressants and muscle relaxants, from the Poli family brought its total employee number to about 230.