Croda Announces Acquisition of Avanti Polar Lipids

Croda International has agreed to acquire Avanti Polar Lipids, a company providing lipid-based drug delivery technologies for next generation pharmaceuticals. Croda has acquired Avanti for an initial consideration of $185m on a debt and cash-free basis, with an additional earnout of up to $75m based on near-term commercial opportunities using Avanti’s lipid-based solutions.

Avanti, founded in 1967 by Dr. Walter and Rowena Shaw, is a technology-rich business that operates globally from one site in Alabama in the United States. Of its 150 employees, more than 100 are in scientific roles, and 29 have PhD qualifications. The expertise of its people drives the ongoing development of an extensive IP portfolio with the launch of 125 innovative products typically each year.

Avanti creates and makes high-purity polar lipids that are increasingly being used as delivery systems for complex therapeutic drugs and in next-generation mRNA vaccines. These lipid technologies ensure the targeted, controlled and extended release of active pharmaceutical ingredients (APIs), increasing their efficacy and safety. The business provides its world-class products and services to the majority of the leading pharmaceutical companies, as well as to thousands of biotechnology businesses and academic research organisations.

Avanti’s knowledge and technology are complementary to Croda’s own capabilities in drug delivery systems, vaccine adjuvants and immunotherapy. The acquisition will more than double Croda’s research and development (R&D) capability in drug delivery. Avanti will also provide a new channel to market Croda’s ingredients for early-stage pharmaceutical research in both commercial and academic organizations worldwide. Equally, Avanti will be able to combine its leading position and flexibility in pharmaceutical R&D applications with Croda’s access to global markets, manufacturing expertise and capacity.

The acquisition is subject to customary US regulatory approvals. On completion, Avanti will continue to operate under its existing brand, led by the current management team. It will become a part of Croda’s Life Sciences sector and sit within the fast-growing Health Care business. The acquisition is being financed by a three-year term loan, maintaining Croda’s strong liquidity.

“We have long admired the Avanti team for their deep scientific know-how and are already working together on high-potential commercial opportunities. With their exciting drug delivery technologies, Avanti is a market leader in a high growth niche of the health care market, serving over 3,000 customers globally,” Steve Foots, Chief Executive Officer of Croda, said. “Bringing Avanti’s best-in-class expertise into Croda also significantly enhances our presence across the pharma product lifecycle, including early stage R&D, clinical trials, analysis and formulation. I am confident that Avanti will prove transformative to the capabilities and performance of our Life Sciences sector.” 

“Together with Croda, we are delighted to have found the right home for Avanti, which has been a lifetime’s work for my wife, myself and many of the team. This transaction comes at an exciting moment in the development and proven need for our proprietary lipid systems, and Croda’s skills and Avanti’s capabilities are a powerful match. I am convinced that Croda, with its focus on innovation, is the best place for Avanti to realize its global potential,” Walter Shaw, Chief Executive Officer of Avanti, said.