CVC is pleased to announce that a consortium of funds (the "Consortium") led by CVC Fund VII has agreed to buy the holding company that owns a majority interest in Recordati.

Chairman Alberto Recordati said: "Today is an important moment in the further development of the company my grandfather founded over 90 years ago. We have found in CVC a partner who shares our vision, values and passion for the company, its employees and its role in developing and distributing healthcare around the world."

Andrea Recordati, CEO, said: "I believe that this is a great outcome for the company and its employees who will benefit greatly from having CVC as a partner. In the process of finding the best partner to take Recordati forward, it was important to find a party that would allow Recordati to remain independent, with continuity for management and employees, and accelerate its growth strategy as a leading global consolidator in the pharmaceutical industry. I am very pleased to be working alongside CVC in accelerating Recordati's global expansion. I am personally reinvesting alongside the Consortium as I believe in and support Recordati."

Giampiero Mazza, Head of CVC Italy, said: "We are honoured to be chosen by the Recordati family who have put great trust in us to continue in their role as the majority shareholder of their company. We have a great admiration for the business which we have known for over many years since Giovanni Recordati was CEO. We are excited by the opportunity to support this excellent management team, led by Andrea Recordati who we have asked to remain as CEO and who carries on the company's legacy and provides the continuity of the business and its strategy alongside Fritz Squindo, Recordati’s Managing Director and CFO."

Cathrin Petty, Head of EMEA Healthcare at CVC, added: "Recordati has always been a very carefully managed, international pharma company with a broad platform of products and a strong geographical footprint in primary care. Over the last decade Recordati has built up a very attractive rare disease business which we look forward to expanding in addition to the core business. We hope that through our expertise and global healthcare network we will help accelerate this growth across orphan and specialty care to build a global leader in the industry."

The transaction is structured as a fully financed acquisition by the Consortium of the family’s holding company FIMEI S.p.A for an Enterprise Value of €3.03bn. FIMEI owns 51.8% of Recordati S.p.A., implying a 100% equity value for Recordati S.p.A. of €5.86bn, equivalent to €28.00 per share. The members of the Recordati family will receive part of the consideration in the form of a deferred and subordinated long-term debt security in the amount of €750 million. Furthermore, Andrea Recordati in his capacity as CEO will invest alongside the Consortium.

Closing of the FIMEI purchase is anticipated to take place in the last quarter of 2018 and is subject only to mandatory competition approvals. Following closing, in accordance with CONSOB rules, the Consortium will make a mandatory tender offer ("MTO") to the remaining minority shareholders. The Consortium's current expectation is that Recordati will remain a publicly listed company. The Recordati family requested, and the Consortium has agreed, to provide other shareholders with a full cash offer at €28.00 per share, which implies a higher economic value than the cash and deferred payment made to the Recordati family. The offer of the full price in cash to the minority shareholders in the MTO is subject to the absence of a material market correction prior to closing of the FIMEI transaction (defined as a decrease in the FTSE MIB index of more than 20%). In such an event, the Consortium intends to lower the cash offer price in the MTO, in consultation and agreement with CONSOB, to a price equivalent to the actual consideration paid to the Recordati family (taking into account the present value of the deferred payment).

Leopoldo Zambeletti and Rothschild are acting as financial advisor to CVC. Gattai, Minoli, Agostinelli & Partners together with White & Case LLP are acting as legal advisors to CVC. Facchini, Rossi are acting as tax advisor to CVC. Committed financing for the transaction is being provided by Deutsche Bank, Credit Suisse, Jefferies and Unicredit.

The Consortium led by CVC Fund VII includes PSP Investments and StepStone.