WILMINGTON, N.C. – Pharmaceutical Product Development (Nasdaq: PPDI) is going private in an all-cash deal valued at $3.9 billion. The news set off a buying frenzy of PPD shares with more than 21 million traded before noon and share prices soaring past the price set for the deal.
By the close, more than 34 million shares changed hands. The stock closed up 25.8 percent, or $6.62, at $32.28. Shares peaked at $32.63 before falling back.
The daily average is 1.5 million.
The Wilmington-based life science services firm known as a contract research organization has agreed to be acquired by private equity firms The Carlyle Group and Hellman & Friedman.
The firms will pay $33.25 per share for PPD shares.
The total represents a nearly 30 percent premium over PPD’s closing price on Sept. 30. Shares closed at $25.66.
The news sent PPD shares up more than 25 percent, or $6.57, to $32.23 just after the markets opened.
The stock’s 52-week high is $33.07.
However, PPD retains the option to pursue other potential buyers and to entertain other offers over the next 30 days in the event PPD is able to land “a superior proposal,” PPD said in a statement.
The private equity firms have the right to match any other offer.
“The sale of PPD to The Carlyle Group and Hellman & Friedman provides an attractive return for our shareholders, while also ensuring a secure foundation and commitment to investment, innovation and excellence for PPD clients and employees as the company builds on its 25-year history of success,” said Fred Eshelman, the founder and executive chairman of PPD, in a statement.
Eshelman is the company’s largest individual shareholder with nearly 7 million shares. ()
Rumors have circulated for months that PPD was looking for a buyer. (Read more details here.)
The deal has been approved by PPD’s board. A shareholders meeting will be held at a later date to vote on the deal.
PPD named a new chief executive officer two weeks ago and recently reported strong quarterly earnings.
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