Business Blog: Hoover’s Business Insight Zone

I’ve been meaning to talk about this company — which made its IPO filing the last week of July — but I’ve kept forgetting. Talecris Biotherapeutics‘ stock in trade is protein therapy products, which use proteins (as the name would suggest!) to treat a variety of ailments including burns, hemophilia, and immune deficiency disorders. Since its products are derived from blood plasma, the company has its own network of plasma collection centers.

Okay, so far so good — but why a $1 billion IPO? It’s not like Talecris is a marquee name.

The short answer: private equity priorities. Cerberus Capital and Ampersand Ventures paid a pretty penny for Talecris a couple of years ago when they bought the business from Bayer. As you’d expect, private equity outfits like these are nothing if not focused on how they’ll make money from a deal. So while Talecris doesn’t seem particularly special in its field, its owners have a strong vested interest in selling it while the selling is good — a window that may be closing given the overall malaise that has struck the financial markets in recent months.

The bad news for Talecris itself is that the proceeds from the IPO probably won’t do much for its ongoing business. (I’ve shared my opinions on the “wisdom” of this approach before.) Instead, the money will be used to pay off its investors and (maybe) pay down some of the debts that private equity firms always load onto their portfolio companies.

For more coverage on this IPO, check out this story from the Raleigh News & Observer:

Talecris plans IPO to raise $1 billion

For an opinionated take on what the deal means for the private equity/IPO nexus as a whole, check out David Hamilton’s take from VentureBeat:

Talecris, a Ludicrously Large IPO, and the Beginning of the End for Private Equity?

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