James Maynard, one of North Carolina’s most esteemed investors and best known for his Golden Corral restaurants, got a big pay day through the February sale of Biologics Inc. to San Francisco-based McKesson Inc. The Cary-based cancer-drug sales company is a portfolio company of Maynard’s Investors Management Corp.
Details of the sale were not provided by McKesson, which simultaneously announced its purchase of Vantage Oncology, a Manhattan Beach, Calif.-based provider of radiation oncology services. The combined price tag for Biologics and Vantage was $1.2 billion, McKesson said.
Ownership of privately held Biologics is unclear, aside from Investors Management. Biologics spokeswoman Allison Keenan declined to disclose Maynard’s stake or that of other investors.
Biologics was started in 1994 by Robin Smith and Karen Freeman, who proposed a one-stop shop to provide cancer patients with specialty medicines needed for their illnesses. The company was valued at less than $60 million in 2007, when a private-equity group that included Maynard, Cherokee Investment Partners’ Tom Darden and retired IBM Vice Chairman Paul Rizzo bought more than a third of the company’s equity for $19.3 million, according a state securities filing cited by the Triangle Business Journal. Annual revenue then totaled $45 million.
In 2010, Smith and Freeman told their majority ownership to an investor group that included Raleigh leaders including Maynard’s associate Richard Urquhart, banker James Hyler and surgeon Richard Myers. Stuart Frantz took over as CEO at that time.
Since 2010 Biologics’ staff increased from 68 to 350 as it signed contracts with large drug companies to support patients with cancer and other diseases, according to a company press release in July. It doesn’t disclose sales, which Barclays analyst Eric Percher estimated to be $900 million a year.
McKesson reported net profit of $2 billion with revenue of $189 billion in 2015. It is paying for the acquisitions with a mix of cash and debt and an 11 cents-per-share gain is expected during the fiscal year ending March 31, 2017, the company said in a release.
Maynard has handed off the CEO title at his company to his son, Quinton. Investors Management’s other holdings include a building supply company, the Fleet Feet Sports retail chain and the KDI Capital Partners money-management firm.
For a more in-depth look at the transaction, this is a report from a pharmaceutical industry blog.
http://www.drugchannels.net/2016/02/inside-mckessons-acquisition-of.html
