CBPE Capital’s sale of IDIS continues to make the headlines, most recently at The Private Equity Awards last month, where CBPE was awarded UK Small Deal of the Year for its sale of IDIS in 2015. This follows on from winning Small Buyout Exit of the Year at the British Private Equity Awards last October.
CBPE acquired IDIS in 2005 for an Enterprise Value of £22million. In April 2015 IDIS was sold to Clinigen, the AIM-listed speciality pharmaceuticals and pharmaceuticals services business, for an Enterprise Value of £225m. The sale represented a money multiple of 22x CBPE’s £9.4m investment in IDIS.
Under CBPE’s ownership IDIS grew to become the global leader in providing regulatory and ethically compliant access to unlicensed medicines for healthcare professionals and their patients with unmet medical needs. The business supplies medication in almost 100 countries to over 100,000 patients each year. Its customers include 17 of the top 20 global pharma companies as well as biotech companies, hospitals and retail pharmacies. Between 2005 and 2015, IDIS' EBITDA rose from £3.6m to £15.6m. The number of employees at the company during this time increased from 69 to 189.
“It is generally recognised that operational value creation is very important.” says Peter Gissel, Partner at CBPE. “Investors are increasingly looking to funds like CBPE to demonstrate they can deliver operational improvement and genuinely add value to a business.”
Technology was a major driver behind value creation at IDIS, and Intuitus was engaged by the company on a number of technology related projects between 2013 and 2015. One extended engagement throughout this period was the provision of project assurance as IDIS implemented a multi-million pound global ERP system. In addition to this, Intuitus provided interim CIO services, led the ERP implementation cutover process, conducted an assessment of the company’s IT infrastructure and security arrangements, and supported contract negotiations with two potential service providers.
“Technology is a lever for efficiency gains and a key part of value creation,” says Gissel. “It has to be fit for purpose. If it isn’t then we need to make changes and we’re happy to have Intuitus as a trusted adviser working alongside CBPE and our management teams.”
The successful implementation of the ERP system was a major value driver. “As we progressed through the ERP project, Intuitus acted as an expert adviser to the Implementation Committee by risk-testing potential outcomes, acting as an additional sign-off “gate” and by generally challenging and acting as a sounding board for both management and the implementation team. Having this external guidance gave the rest of the team confidence that things were being done properly.”
According to Gissel, Intuitus’ lead consultant Anne Munro was “fundamental to the oversight of risk management and to the technical competence of the project.”
Iain Mackay, Intuitus’ Technical Director, who led all the engagements adds: “Intuitus’ offerings focus on specific strategic issues, and we were happy to provide IDIS with real insight on these critical business technology initiatives.”
Intuitus provides a range of expert strategic advisory and operational improvement services to private equity-backed companies. Engagement drivers tend to be related to the challenges of business growth, technology performance and exit. To discuss how Intuitus can support you please contact us.