Parexel said today that it would go private after Pamplona Capital agreed to buy the pharmaceutical research services company in a deal valued at $5 billion.
Pamplona is slated to pay $88.10 per share for Parexel, which is a 5% premium to the stock’s close on Monday.
Activist investors, such as Starboard Value, have been pressuring Parexel to explore a sale and have argued that the company’s profit margins aren’t competitive with its peers.
The Boston, Mass.-based company largely focuses on cancer drug research. It has developed a platform for companies to tout their “real-world” data and justify product prices to health insurers.
The deal is expected to close in the 4th quarter, according to Reuters.
Earlier this year, Pamplona made an unsuccessful bid to acquire a clinical trials firm, Pharmaceutical Product Development.
As pharmaceutical companies seek to cut costs and lessen the time spent in clinical trials, the contract research industry has undergone a lot of consolidation. Last month, INC Research Holdings and inVentiv Health inked a $4.6 billion merger deal and last year Quintiles Transnational Holdings and IMS Health Holdings agreed on a $9 billion merger.
Material from Reuters was used in this report.