2. As already said if Kendle wants to become bigger and succeed in the new competitive landscape the acquisitions way was the only available. Having these new units in Europe will allow Kendle to satisfy the customer international expectations, be present in a new market, increase their knowledge through experienced companies especially focused on Phase 2 and 3 where Kendle wanted to invest. The proposed deals seem priced fairly. In fact looking at the data on Comparables CRO acquisitions done either in Europe or US market the average Ratio of deal value to Ebitda has been 12.2 times. U-Gene were supposed to be acquired with a multiple of 9.8 time Ebitda, meanwhile gmi at 8.2 times Ebitda. Both pricing seemed in line with recent CRO deals.

3. What strategy would you recommend? Proceed with both acquisitions now or do one follone by an initial public offering (IPO) and the second acquisition later?The strategy Kendle chose (Acquisitions and IPO at the same time) was the most risky one especially from the financial point of view. Furthermore in the same moment the stock prices of the CROs have been dramatically falling down. If market continued to went down the IPO could become unsuccessful and huge debts they collected will be probably too high to survive especially if compared with their modest equity rate.<br />From a managerial point of view of course the strategy is really aggressive and could give to Kendle the possibility to increase their size and get a relevant market share in one shot. Their financial plans seemed safe and assuming to an IPO of 3 Man new share at a price of 13$ EACH, Kindle would have a cash position of about 14$ Man and no debt in the capital structure. The real trouble could be the financial market situation which was really risky and with a bottom tendency.<br />I sustain the Kendle’s direct approach in doing the operations all at once, even if very risky. The safer approach of doing a first acquisition + IPO and then the second one could bring Kindle to miss the IPO window and miss the opportunity to acquire the second company. This means consequently to cut the Kendle’s owners dreams to resize their company and start growing and competing at a different international level.<br />