Arsenal scores 4.1x on pharma exit

The New York-based firm has sold its portfolio company Scientific Protein Laboratories for about 4.1x to a publicly traded buyout firm, says a source close to the deal.

Arsenal Capital Partners has sold Scientific Protein Laboratories to American Capital Strategies, a publicly traded buyout and mezzanine fund, for an undisclosed amount. A source close to the deal said the exit returned 4.1x to investors.

Scientific Protein Laboratories manufactures and supplies biologic active pharmaceutical ingredients (APIs), including heparin and pancreatin APIs. These active ingredients go into pharmaceutical products. The company also produces bulk pharmaceuticals.

Arsenal acquired SPL in February 2004 from Wyeth, a publicly traded pharmaceutical company. The purchase price was $81 million (€63 million). Wyeth was formerly known as American Home Products.

The previous August, In Arsenal had agreed to buy Rutherford Chemicals from Cambrex Corp. for $64 million. Rutherford is a niche provider of speciality chemicals to multiple markets, including pharmaceuticals. In July Arsenal combined Rutherford with Reilly Industries to form Vertellus Specialties.
SPL was formed by Oscar Mayer Foods in 1976 to produce pharmaceutical and chemical products out of animal processing waste products. The company still does some of that work.
Arsenal Capital typically invests in specialty products and services companies in niche markets such as healthcare, specialty chemicals, aerospace/defense, specialty components and distribution/logistics.