Swedish private equity firm EQT agreed to take UK veterinary drugmaker Dechra Pharmaceuticals private in a deal worth about 4.88 billion pounds ($6.16 billion), the British company said on Friday.
The deal, which is expected to close in the second half of 2023, will see Dechra delisted from the London Stock Exchange.
EQT said it would pay 340 pence per Dechra share, a premium of 46% to the company's closing price on Thursday.
"We are delighted to have reached an agreement with EQT," said Dechra Chief Executive Martin Dockrell. "This transaction provides Dechra with the opportunity to accelerate our growth plans and further strengthen our position as a leading global animal health company."
EQT said it would support Dechra's growth plans, including its expansion into new markets and the development of new products.
"We are excited to partner with Dechra and its talented management team," said EQT Partner Anders Nilsson. "We believe Dechra has a strong track record and a bright future, and we look forward to supporting the company's continued growth."
Dechra is a leading global animal health company with a focus on developing, manufacturing, and marketing veterinary medicines and products. The company has a strong presence in the UK, Europe, and North America, and it is also expanding into new markets such as Asia and Latin America.
The deal is the latest in a series of private equity buyouts of UK-listed companies. In recent years, private equity firms have snapped up a number of British businesses, including Boots, Morrisons, and B&M.
The trend is being driven by a number of factors, including low interest rates, which make it cheaper for private equity firms to borrow money, and a growing pool of capital from institutional investors such as pension funds and insurance companies.
The deal is also a sign of the growing importance of the animal health market. The global animal health market is worth an estimated $30 billion, and it is expected to grow at a compound annual growth rate of 5% over the next five years.
The deal is expected to face scrutiny from antitrust regulators, as Dechra is a major player in the UK veterinary drug market. However, EQT is confident that the deal will be approved by regulators.
"We believe that this transaction is in the best interests of Dechra's shareholders, employees, and customers," Nilsson said. "We are confident that we will be able to successfully complete the transaction and create a leading global animal health company."