The sale of drug manufacturer LaborMed Pharma, acquired by US investment fund Advent, first began in June 2007, when shareholders were reticent to exit the company completely. At the time, the pharmaceuticals company was the last player held by local entrepreneurs.
"We contacted over 100 groups, which included strategic investors (generic drug manufacturers)- 70%, and financial investors -30%. Of these, over 30 confirmed an interest, and around 25 came with non-binding offers," stated Ioana Filipescu, managing director of Raiffeisen Investment, which was authorised to handle the sale by the shareholders.
The non-binding offers included an indicative price, which meant the first selection criterion was also the simplest (i.e. financial).
"We drew the line at 100 million euros, the price we actually had in mind as a starting point for discussions. The offers we had at that moment ranged from 100 to 130 million euros," explained Filipescu.
Legal consulting for the transaction was provided by law firm Popovici Nitu & Asociatii (Popovici Nitu & Partners), with a 5-member team.
"The interest in this transaction was huge. LaborMed was the foreign players' last chance to acquire a Romanian pharmaceuticals company. There was a lot of interest, but this didn't necessarily mean that the lawyers and advisers' approach was aggressive, in fact it was rather balanced," said Bogdan Stoica, a partner with Popovici Nitu & Asociatii.
The significant number of potential buyers prompted Raiffeisen Investment to attempt a first on the Romanian market - vendor due-diligence.
"Whereas during a normal M&A process, each buyer puts together their own due diligence report, we, anticipating the high interest in LaborMed, realised that it would be impossible to have 10-14 due-diligence reports, because it is an activity that consumes both time and resources," added Ioana Filipescu.
Under such circumstances, the seller hires companies that put together independent business assessment reports, which are then distributed to the potential buyers. The transaction was finally signed in December and totalled 123 million euros.
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