Patheon, a Durham pharmaceutical services company, finally appears poised to go public more than a year after filing plans for an initial public offering.
The company, which generated $1.77 billion in revenue in its latest fiscal year, disclosed Monday that it plans to move forward with its IPO and is looking to sell 30.5 million shares for at least $580 million. Patheon’s target price for those shares is between $19 and $22 each.
The shares being offered would amount to 22 percent of the 141.2 million total outstanding shares post-IPO. That would give the company a market capitalization – the total value of its outstanding shares – of $2.89 billion if the shares are sold for $20.50, the mid-point of the target range.
Patheon initially filed IPO plans in June 2015 but until Monday hadn’t offered details, such as the number of shares it plans to sell and the target price, which are required before moving ahead.
IPOScoop.com, which publishes an IPO calendar based on information from underwriters, is anticipating that the company will go public next week.
Patheon, which moved its headquarters to the Triangle in 2008, has been publicly traded before. But it went private in 2014 when it merged with DSM Pharmaceutical Products as part of a complex three-way deal.
Led by CEO Jim Mullen, who previously was the chief executive of Biogen Idec, Patheon has 8,800 employees worldwide, including about 150 at its Durham headquarters. The company manufactures and packages prescription and over-the-counter drugs for its clients; it also provides services such as developing formulations of experimental medicines and synthesizing chemicals for a broad range of industries.
For the fiscal year that ended Oct. 31, Patheon posted $138.4 million in net income on revenue of $1.77 billion. For the six months that ended April 30, it generated $874.5 million, compared to $863.9 million a year earlier, and a net loss of $21.2 million.
Patheon plans to sell 25.6 million shares, while Royal DSM, the Netherlands vitamin company whose pharmaceutical products business was merged into Patheon in 2014, plans to sell 4.9 million shares.
Patheon anticipates net proceeds of $492.3 million after fees and expenses if the shares it is selling fetch $20.50, or $580.9 million if the underwriters exercise their option to purchase additional shares. The company plans to use that money to repay $550 million in debt.
If the IPO is successful, Patheon shares would be traded on the New York Stock Exchange under the ticker symbol “PTHN.”