(Reuters) - Buyout firm Leonard Green & Partners LP has agreed to join private equity firm Arsenal Capital Partners as an owner of U.S. clinical trial services company WCG, the companies said on Thursday.
The deal values WCG at about $3.1 billion, according to a source familiar with the matter.
The group recapitalizing WCG also includes Novo Holdings, the investment arm of the Novo Nordisk Foundation and the deal is expected to close in the first quarter of 2020, the companies said.
WCG reduces the time and cost of enrolling patients in clinical trials, helping firms enroll patients in their studies and negotiating with the medical institutions that conduct their trials.
“A good drug, if it is effective, if it takes five years to reach a patient, that’s tragic,” Donald Deieso, WCG’s chief executive officer, said in an interview. He added that administrative delays can be improved through the use of technology.
WCG has had earnings before interest, tax, depreciation and amortization of around $175 million this year, according to the source, who asked not to be identified because financial details of the transaction were not disclosed.
Arsenal has been an investor in WCG for seven years. The company was called Copernicus Group Institutional Review Board when Arsenal acquired it in 2012.
Centerview Partners LLC acted as financial advisor to WCG and Arsenal, while Barclays Plc (BARC.L) served as financial advisor to the investor group led by Leonard Green.
Reporting by Rebecca Spalding in New York; Editing by Edwina Gibbs