BC Partners, Onex, American Securities vie for Ikaria -sources


By Greg Roumeliotis, Soyoung Kim and Jessica Toonkel

NEW YORK, Nov 22 (Reuters) - BC Partners Ltd, Onex Corp and American Securities LLC are competing for IkariaInc, a private equity and venture capital-backed specialty drugcompany that may fetch up to $2 billion, according to peoplefamiliar with the matter.

The three private equity firms are among those through tothe second round of bidding for Ikaria, with final offerscurrently due by early December, the people said this week oncondition of anonymity because the process is confidential.

Ikaria, BC Partners and American Securities declined tocomment while an Onex spokeswoman did not respond to a requestfor comment.

Hampton, New Jersey-based Ikaria's main drug INOMAX deliversnitric oxide gas to treat newborns with serious troublebreathing, allowing for more oxygenated blood to circulate intheir bodies. It also has a pipeline of what it calls "criticalcare" products for patients with life-threatening injuries ordisease.

Ikaria, whose owners include New Mountain Capital LLC, ARCHVenture Partners LP and Venrock Associates LP, is working withMorgan Stanley and Credit Suisse Group AG onthe possible sale, people familiar with the matter told Reuterslast month.

The company was created in 2007 when investors led by NewMountain merged a biotechnology company also called Ikaria withGerman industrial gas producer Linde AG's INOTherapeutics, in a $670 million cash and stock deal.

The deal left Linde as minority investor in Ikaria, creatinga company with more than $160 million in revenue. Six yearslater, Ikaria had about $361 million in 12-month revenue as ofthe end of March 2013, according to Moody's Investors ServiceInc.

With several of its key patents expiring this year and next,Ikaria is more vulnerable to competition although its heartfailure patents expire in 2029 and some others in 2031,according to Moody's.

Ikaria filed for an initial public offering in 2010 butwithdrew the registration that same year citing marketconditions. It owners have taken several dividends from thecompany, including a $475 million distribution last summerthrough borrowing.

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