UPDATE 2-THL Partners to buy InVentiv for $1.1 bln

Thu May 6, 2010 6:12pm EDT

* Thomas H. Lee Partners to pay $26/shr

* Expects to close deal in Q3

* Shares up 6 pct in extended trade (Adds details, updates share movement)

By Anand Basu

BANGALORE, May 6 (Reuters) - Pharmaceutical services provider InVentiv Health Inc VTIV.O said it agreed to be acquired by private equity firm Thomas H. Lee Partners [THL.UL] for about $1.1 billion.

THL Partners will pay $26 per share, a premium of 7 percent to InVentiv's closing price Wednesday on Nasdaq. However, InVentiv shares had already risen 42 percent since March 26, when the company confirmed that it had been approached by investors.

David Windley of Jefferies & Co said the premium offered by THL was much higher than what the stock was trading before March 26.

"We thought a deal might go as high as mid-twenties, so the purchase price is coming at the high end of where I was thinking," said Windley, who has a "hold" rating on InVentiv shares.

InVentiv expects to complete the deal in the third quarter of 2010.

Last month, Apollo Management outdid THL Partners, and acquired CKE Restaurants Inc CKR.N, the owner of the Hardee's and Carl's Jr. hamburger chains. [ID:nN25165185]

CKE had previously agreed to be acquired by THL Partners for $11.05 per share, or $619 million.

THL is also one of the partners in Blackstone Group's (BX.N) bid to buy Fidelity National Information Services (FIS.N). [ID:nN06211461]

Goldman Sachs & Co. acted as financial advisor, for InVentiv's board, while Citigroup is advising Thomas H. Lee.

Q1 RESULTS

Separately, InVentiv reported better-than-expected quarterly profit, helped by higher revenue from its clinical and communications segments.

For the first quarter the company reported a net income of $10.2 million, or 30 cents a share, compared with $7.9 million, or 24 cents a share, a year ago.

Excluding items it earned 33 cents a share. Revenue rose 5 percent to $269.4 million.

Analysts on average expected earnings of 26 cents a share, excluding special items, on revenue of $272.1 million, according to Thomson Reuters I/B/E/S.

For the first quarter, InVentiv's clinical revenue rose 5 percent to $54.0 million, while communications revenue were up 24 percent to $88.1 million.

Shares of the Somerset, New Jersey-based company were up 6 percent at $25.30 in extended trade. (Reporting by Anand Basu in Bangalore; Editing by Anthony Kurian and Anil D'Silva)