Business

Founder Michael Burke sells Chanelle Pharma to UK private equity group

Staff briefed that Exponent has acquired largest generic drug manufacturer in State in deal worth about €300m

Chanelle founder and owner Michael Burke has sold the business he founded over 40 years ago for around €300m. Photograph: Michael Dillon

Dominic Coyle
Wed Feb 7 2024 - 10:45

Vet-turned-businessman Michael Burke has sold the Chanelle Pharmaceuticals he founded more than 40 years ago for a figure understood to be about €300 million.

British private equity group Exponent will take over the business that Mr Burke put on the market through investment bank Rothschild & Co last year. The company’s 730 staff were briefed on Wednesday on the takeover of the business, the largest producer of generic medications for humans and animals in the State.

“Having dedicated my life to building Chanelle Pharma into a global company, I have decided the time is right to allow new owners to lead the company into its next phase of growth,” Mr Burke said.

“I am very pleased that Exponent is acquiring Chanelle Pharma. They value the heritage of our company and share our ethos and vision. They have the expertise and resources to grow Chanelle Pharma with new investment across all our operations.”

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Mr Burke will retire from the business following the sale, which is subject to approval from the Competition and Consumer Protection Commission.

“I want to thank my management team, all our employees and our customers and suppliers who have supported me personally, and Chanelle Pharma over the past 40 years and I wish [Exponent partners] David [McGovern], James [Gunton] and all in Chanelle Pharma continued success in the future,” he said.

While the parent company does not publish publicly available results, the most recently filed figures for its manufacturing arm – Chanelle Pharmaceuticals Manufacturing Limited – show that it made a profit of €17.2 million on sales of €82.6 million in the 12 months to the end of April 2022.

Profits were 35.5 per cent up over the year on sales that had jumped by a quarter. The business paid out dividends of €10 million to the Burke family shareholders during that year.

Chanelle Pharma exports to 96 countries and supplies 10 of the top 12 human generic multinational companies in the world and 10 of the top 12 animal health multinational companies globally. It holds more than 1,900 product licences for human health products worldwide and 3,500 product licences for animal health.

Our investment in Chanelle demonstrates our commitment to partner with market-leading Irish businesses seeking to grow internationally and accelerate their growth

—  David McGovern

Exponent, which recently opened an office in Dublin and targets companies with an enterprise value of between €150 million and €500 million, has invested more than €1 billion in Irish-owned or Irish-based businesses to date out of the more than €3 billion the group has raised overall. Chanelle Pharma is the firm’s sixth investment in Ireland since it entered the market in 2012 with the purchase of Fintrax (now Planet).

Since then, it has acquired the Racing Post, recycling specialist Enva, Limerick-based high voltage electrical engineering business H&MV Engineering and Xeinadin, which offers accountancy services and business advice for SMEs across Britain and Ireland.

Internationally, its investments have included Trainline, Moonpig, Ambassador Theatre Group, Big Bus, Dennis (publisher of The Week magazine), SHL, Isio (formerly KPMG Pension Advisory), Loch Lomond and Quorn Foods.

Mr McGovern said: “We are delighted to invest in Chanelle, a company we have admired for a long time. Our investment in Chanelle demonstrates our commitment to partner with market-leading Irish businesses seeking to grow internationally and accelerate their growth. We look forward to working closely with Chanelle’s management team to strengthen its global presence and invest in its capabilities.”

[ Galway’s Chanelle Pharma poised for €300m sale to private equity firm ]

Fellow Exponent partner James Gunton said the group saw “tremendous opportunity in the development pipeline and look forward to bringing new products to market”.

Both parties said that Chanelle will remain an Irish-managed company with the current management team remaining in place.

Chanelle Pharma was advised by Rothschild & Co, Arthur Cox and PwC. Advisers to Exponent were: Canson Capital Partners, Allen & Overy, A&L Goodbody, KPMG.

Dominic Coyle

Dominic Coyle

Dominic Coyle is Deputy Business Editor of The Irish Times

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