The New York investment firm is buying $250m of Cryoport convertible preferred stock and $25m of common stock. Another $45m is coming from the company’s balance sheet.
Cryoport will use the money to buy MVE Biological Solutions from Chart Industries for $320m. The deal is expected to close by the end of 2020. Blackstone will end up with an 18% stake in Cryoport, executives said.
Cryoport is a market leader and currently supports 491 active clinical trials globally, including eight supporting vaccines and treatments for Covid-19, according to company CEO Jerrell Shelton. He said his vision is for Cryoport to become the “pre-eminent supplier” of temperature controlled chain solution logistics for life sciences.
MVE, which had $83.7m in 2019 revenue, provides freezers and other equipment used for storage and transportation of cells and tissue. The addition of MVE is expected to expand Cryoport’s role in the cell and gene therapy supply chain ecosystem and will enhance Cryoport’s footprint in servicing the life sciences and specialty cell therapy arena, Shelton said.
The buy, which was the result of an auction process, comes just days after Cryoport agreed to acquire CRYOPDP for €49m. CRYOPDP, of France, provides temperature-controlled logistics services for the clinical research, pharma and cell/gene therapy markets.
The deal appears to be an exit for Hivest Capital, a French private equity firm, which just acquired CRYOPDP in March. Hivest could not be reached for comment. The CRYOPDP deal will expand Cryoport’s footprint in the Middle East, Africa, and Europe.
Blackstone’s investment isn’t coming from its Life Sciences fund, which raised $4.6bn earlier this year. Blackstone Life Sciences invests in drugs that are in clinical trials and not pharma services, said Ram Jagannath, a Blackstone senior managing director and global head of health care for Blackstone growth and tactical opportunities.
Instead, Blackstone is using its tactical opportunities unit, which will consider companies that service the pharma sector, to invest in Cryoport, he said.
Pharma has seen activity lately. Kohlberg and Mubadala Investment agreed Monday to buy a majority of PCI Pharma Services from a group led by Partners Group. The deal was valued at $3bn. PCI provides outsourced pharmaceutical supply chain services for the biotechnology and pharmaceutical companies.
Source: Barron’s
