Radnor-based Avantor, a life science tools company, recently signed a definitive agreement to divest its clinical services business to Audax Private Equity for approximately $650 million.
The clinical services business is part of Avantor’s Laboratory Solutions segment. In 2024, it is expected to generate approximately $200 million in revenue. It employs approximately 800 people.
The deal includes biorepository, kitting, and related equipment and ancillaries, and is subject to regulatory approvals and other customary closing conditions.
Avantor expects to receive a reduction of approximately $50 million in capitalized leases, and approximately $475 million in after-tax cash proceeds. It will use the after-tax proceeds to pay down debt, strengthen its balance sheet and reduces interest expenses.
“The divestiture enables us to enhance our focus on strategic growth opportunities in our lab and production businesses, while strengthening our balance sheet,” Michael Stubblefield, Avantor president and CEO, said.
The deal is expected to close during the fourth quarter, and the company will discuss the divestiture during its third quarter 2024 earnings conference call.
Avantor provides of mission-critical products and services to the life sciences and advanced technology industries. Its portfolio is used at more than 300,000 customer locations in 180 countries during research, development and production activities.