CVC Capital Partners seeks cash injection for Italian pharma group

Luxembourg-based private equity group CVC Capital Partners is reported to be looking for a buyer for its majority stake in Genetic Group, according to the Financial Times.

CVC currently owns 60% of the Italian pharmaceutical contract manufacturing company and is looking to raise around €700m from the sale.

According to the report, advisers from Rothschild have been hired to help carry out a sale. Contacted by Euronews, CVC declined to comment on the report. 

Genetic Group founder Rocco Pavese and his family still hold a minority stake in the business which they are interested in keeping, even if CVC sells its own stake. 

Genetic, based in Salerno and set up in 2000, makes technology for products such as nasal sprays, inhalers and other medical devices. It owns the intellectual property of some 50 products and sells its products in more than 30 countries.

Since taking it over in 2020, CVC has doubled Genetic’s pre-tax earnings, excluding interest, depreciation and amortisation, to some €50m.

The appeal of contract manufacturers

Contract manufacturing companies have seen a boom in popularity in recent years as pharmaceutical companies increasingly end the in-house manufacturing of drugs and medical devices and outsource them instead to contract manufacturers, thus saving time and money.  

In turn, this has led to interest from private equity companies who see contract manufacturers as a way of gaining a foothold in the drug development world without having to take the risk of investing in research.

CVC has 30 offices across the world, in countries including Belgium, China, France, Denmark, Germany, India, Hong Kong. It has more than 1,200 employees as well as about €193bn worth of assets under management. It also manages funds for more than 300 investors. 

CVC DIF acquires stake in Singaporean hazardous waste management company

CVC infrastructure arm CVC DIF recently announced it is buying a 49.9% stake in ECO, a Singapore-based hazardous waste management company, from Séché Environnement, which will still retain a 50.1% stake. 

The investment will be carried out through the DIF Infrastructure VII fund and will be CVC’s first Asian investment.

Gjis Voskuyl, managing partner at CVC DIF, said in a press release on the company’s website: “ECO’s leading market position, their longstanding and diversified client relationships and the high barriers to entry in the sector make this an interesting investment for DIF Infrastructure VII. 

“Moreover, this investment marks the first investment of CVC DIF in Southeast Asia, on the back of CVC DIF’s global sector relationships and CVC’s widespread local office network in the region.

“We are delighted to partner with Séché Environnement, a market leader in hazardous waste. Together with Séché Environnement and ECO’s Singapore based management team, we are well-positioned to drive ECO’s growth as a leader in sustainable infrastructure in the region.”