Quintiles Will Not Pursue ClinPhone Acquisition, Parexel’s Offer Stands
Durham, N.C.-based contract research organization (CRO) Quintiles stated it will not counter Waltham, Mass.-based rival CRO Parexel’s bid for the acquisition of ClinPhone, a clinical technology company based in the UK. Parexel’s offer is $182 million in cash, an 86% premium over ClinPhone's share price.
Shortly after Parexel’s bid on June 13, Quintiles released a statement announcing its intention to counter-bid for ClinPhone. At the time the company said: “Quintiles believes that the operations of ClinPhone are a strategic fit with Quintiles’ clinical research capabilities and confirms that it has been in discussions with the board of ClinPhone, which may or may not lead to an offer.”
North Carolina’s News and Observer reported Quintiles declined to comment on the specific reason for the company's reversal; however, it quoted Dick Jones, senior director corporate communications, as saying, "It was worth taking a look." The company plans to “focus on in-house technology” instead of looking for a similar deal in the future, it was reported.
This is not Parexel’s first attempt to buy the company. In February 2008, Parexel made an initial bid for ClinPhone. Although financial details were not disclosed, ClinPhone considered the offer too low.
Already a leading player in its sector, ClinPhone became much more than an interactive voice response and interactive web response (IVR/IWR) company in March 2008, when it launched a combination EDC product – gained through the acquisition of EDC firm Datalabs.
ClinPhone has about 730 employees. Parexel had 2007 revenues of more than $900 million and about 5,600 employees. ClinPhone would fit with within Parexel’s technology subsidiary Perceptive Informatics and would give it an electronic data capture (EDC) system.
Parexel had arranged a $300 million credit facility with JPMorgan Chase Bank and Keybank National Association. Parexel expects that the acquisition will be dilutive to earnings in its financial year ending June 30, 2009.