EQT and Goldman acquire Parexel for $8.5bn

September 2021 | DEALFRONT | PRIVATE EQUITY & VENTURE CAPITAL

Financier Worldwide Magazine

September 2021 Issue

Four years after initially being taken private by Pamplona Capital Management LP, global clinical research organisation Parexel is being acquired again – this time by EQT IX fund and the private equity (PE) business within Goldman Sachs Asset Management, in a deal valued at $8.5bn.

Founded in 1982, Parexel has significant drug development and commercialisation expertise, offering a comprehensive suite of outsourced clinical research services, as well as regulatory, market access and strategy consulting services.

Furthermore, the organisation has been a driving force in the market shift toward decentralised clinical trials and increased patient diversity over the last few years. It employs more than 17,000 people and conducts clinical trials in more than 95 different countries.

“Over the past 18 months, Parexel has continued its strong growth trajectory delivering on its patients-first focus and accelerating new therapies to patients in need around the world,” said Jamie Macdonald, chief executive of Parexel. “EQT and Goldman Sachs support this vision and are committed to investing in Parexel and our people to capitalise on this exciting market opportunity and make a difference for patients.

“We are excited to be partnering with EQT and Goldman Sachs,” he continued. “We look forward to benefitting from their strong industry experience and to further accelerating Parexel as one of the world’s leading and fastest-growing clinical research organisations.”

A purpose-driven global investment organisation with more than €67bn in assets under management across 26 active funds, EQT has portfolio companies in Europe, Asia Pacific and the Americas, with total sales of approximately €29bn and more than 175,000 employees.

“We have followed Parexel closely during the past few years and have been impressed by the company’s development and trajectory,” said Eric Liu, a partner and global co-head of healthcare at EQT. “Our investment in Parexel reflects EQT’s thematic focus on the life sciences industry, as well as our commitment to partner with businesses that have a positive impact on society. We are excited to partner with Goldman Sachs for the next stage of Parexel’s journey.”

Fellow acquirer, Goldman Sachs Asset Management, invests in the full spectrum of alternatives, including PE, growth equity, private credit, real estate and infrastructure. Established in 1986, the PE business within Goldman Sachs Asset Management has invested over $75bn since inception.

“Parexel has a distinguished track record of delivering clinical excellence to their large pharma and biotech customers globally,” said Jo Natauri, a partner and global head of private healthcare investing at Goldman Sachs Asset Management. “We believe this investment will accelerate Parexel’s growth as it builds on the company’s global footprint, strong operational capabilities and expansive healthcare network.”

Evercore acted as the financial adviser to Parexel and Kirkland & Ellis LLP provided legal counsel. Goldman Sachs and Jefferies LLC acted as financial advisers to EQT and Goldman Sachs Asset Management, and Simpson Thacher & Bartlett LLP provided legal counsel.

The transaction is subject to customary conditions, including receipt of applicable regulatory approvals.

Mr Macdonald concluded: “With the market for outsourced clinical research services anticipated to grow at a conservative compound annual growth rate of 8 to 9 percent, our focus remains on advancing and innovating Parexel to meet our customers’ needs across the evolving clinical development landscape.”

Fraser Tennant