EUR 407.14 For Business Accounts Only

Bormioli Pharma - Initiating coverage with a stable-to-positive view

Bormioli Pharma, the Italian plastic and glass packager for the pharma industry, recently issued €280m of senior secured FRN bonds due 2024. The money, together with an €120m equity injection by Triton Fund, is to finance the acquisition of the company by Triton from Vision Capital for €362m, or 6.9x LTM EBITDA as of June 2017. The is-sue has been rated at B/B2 by S&P and Moody’s respectively, both the same as the corporate rating with a stable outlook.
Bormioli Pharma has been carved-out from Italy-based packager Bormioli Group, fully-owned by Vision Capital since 2011, alongside another business unit Tableware, which is simultaneously being sold to Bormioli Luigi.

We are initiating coverage with a Stable-to-Positive view on Bormioli Pharma. As a niche player, the Italian packager has built, over time, solid positions in Western Europe (81% of sales) and particularly in Italy (40%), in specific plastic and glass pharma containers. Demand for these products is growing steadily. In addition, the non-discretionary nature of drugs and high barriers for new entrants are providing some visibility for future earnings. We believe that Bormioli Pharma will be able to grow by 2% a year, helped by its diversified client base, which includes very long-term relationships with blue chip pharma firms.