Pharmaceutical services giant Quintiles Transnational is on the verge of raising nearly $950 million from investors in an initial public offering of stock after pricing its shares at $40.
The Durham-based company announced after the markets closed Wednesday that it priced its shares, paving the way for them to begin trading Thursday on the New York Stock Exchange under the symbol Q. The company had targeted selling its shares at between $36 and $40.
Its no surprise that Quintiles shares priced at the high end of the target range. The company reportedly moved up its pricing a day thanks to strong demand that enabled it to forgo a day of marketing the deal.
Quintiles is selling about 23.7 million shares in its IPO, or about 18 percent of its total outstanding shares. At $40 each, that puts the companys market capitalization the total value of its outstanding shares at nearly $5.2 billion.
Quintiles is a contract research organization that generates nearly three-fourths of its revenue from helping pharmaceutical and biotechnology companies test experimental drugs. It also assists those companies with selling and marketing prescription medicines once they win regulatory approval.
Quintiles was a publicly traded company from 1994 until 2003. At that time founder and then-CEO Dennis Gillings, who was frustrated with running a publicly traded company, led a $1.7 billion leveraged buyout that took the business private.
Today Gillings is the companys executive chairman. He founded the company in 1982 when he was a biostatistics professor at UNC-Chapel Hill.
Quintiles revenue rose 12.1 percent to $3.7 billion in 2012. It has more than 27,000 employees worldwide, including more than 2,000 in the Triangle, where its headquarters at the Page Road exit from Interstate 40 is a local landmark.
The companys net proceeds from the IPO will total $525 million. The rest will go to Quintiles major shareholders. The 23.7 million shares being sold include nearly 10.6 million being sold by Gillings and four private equity firms: Bain Capital, TPG Capital, Temasek and 3i Corp.
Post-IPO, Gillings and his family will be the companys largest shareholders with a 20 percent stake. The quartet of private equity firms collectively will own 57.6 percent.
The large ownership stake of Gillings and the private equity firms makes Quintiles a controlled company that is exempt from certain corporate governance requirements designed to protect shareholders. For example, a majority of the companys board of directors wont be required to be so-called independent directors.
Quintiles previously reported that it intends to use a portion of its IPO proceeds to pay off some of its $2.4 billion in debt.
Staff writer David Bracken contributed.