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King & Spalding Advises Sandy Springs-Based Arbor Pharmaceuticals on Sale of Stake to KKR & Co.

Wednesday, December 10, 2014   (0 Comments)
Posted by: Angela King
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A team of Atlanta lawyers at King & Spalding advised Arbor Pharmaceuticals, headquartered in Sandy Springs, on its sale of a minority stake to private equity giant KKR & Co. The size of the stake and the financial terms of the deal, announced Dec. 5, were not disclosed.

King & Spalding corporate partner Jack Capers in Atlanta led the legal team for Arbor Pharmaceuticals with counsel Matthew Stewart in Silicon Valley. Lazard Middle Market was the financial adviser for Arbor, and Simpson Thacher & Bartlett was legal counsel to KKR.

According to a Reuters story citing unnamed sources, the transaction values the privately held drugmaker at more than $1 billion, including debt, and KKR bought more than a quarter stake.

Other King & Spalding lawyers who worked on the deal were Atlanta corporate associates Christopher Austin, Sawyer Duncan, Nathan Mihalik, Brian Park and Spencer Stockdale. Samira Hariramasamy and Daniel Ray in Silicon Valley also assisted.

Atlanta partner Rebecca Kaufman advised on intellectual property issues. In New York, partner John Sweet handled tax matters and another partner, Kenneth Raskin, handled ERISA concerns. In Washington, partner Jeffrey Spigel advised on antitrust issues and associate Jessica Ringel advised on FDA regulatory aspects.

Arbor makes prescription drugs for the pediatric, hospital and cardiovascular markets as well as generics through its Wilshire division. It has about 400 employees, which includes more than 300 sales representatives selling to hospitals and doctors, according to KKR's announcement.

Founded in 2006, Arbor was acquired in 2010 by its current investor group, which includes Edward Schutter, who became CEO and is a board member; Jason Wild of JW Asset Management, who became board chairman, and Allen Chao, the founder and former CEO of Watson Pharmaceuticals, who is also a board member.

In the last four years, Arbor has completed more than 20 acquisition, licensing and product development transactions, and the company has several products in late-stage development, according to the announcement.

Schutter formerly headed another Atlanta drugmaker, Sciele Pharma, which was acquired by Japanese pharmaceutical company Shionogi & Co. for $1.4 billion in 2008. "Arbor and our new investment partner KKR maintain a shared vision for continuing to provide quality products that offer significant clinical benefits to patients," Schutter said in the announcement.

Wild called the KKR investment an "important next step as we continue building a fully integrated pharmaceutical company focused on products that improve patients' lives."

The transaction, which is subject to regulatory approvals, is expected to close early in the first quarter of 2015, according to KKR.

"We believe that Arbor, with its diversified product portfolio, late-stage development pipeline, and proven business development acumen, is well-positioned for continued growth," said Ali Satvat, the director of KKR's health care investment team, in the announcement.

Source: Daily Report:

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