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PRA Raises $68.4 Million In Its IPO

By Michael S. Rosenwald
Washington Post Staff Writer
Friday, November 19, 2004; Page E05

PRA International Inc., a McLean company that manages clinical trials for drug companies worldwide, said it raised $68.4 million yesterday in its initial public offering.

The company sold 3.6 million shares for $19 a share, a dollar higher than it had projected. Equity holders in the company sold an additional 2.4 million shares for $45.6 million.

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In PRA's first day of trading on the Nasdaq Stock Market, under the ticker symbol PRAI, shares closed at $21, up $2, or 10.5 percent. Shares had risen as much as 24 percent in early trading.

PRA chief executive Patrick K. Donnelly said the company would use some of the proceeds to hire more employees as it expands operations in Asia and South America.

The company has a small headquarters operation in McLean with 50 employees. It employs more than 2,500 people, about half of them outside the United States. PRA's services include conducting clinical trials for pharmaceutical and biotech companies, as well as advising them on regulatory procedures.

"We have a business consulting model," Donnelly said. "And in that model, you're only as good as your people."

None of the company's executives sold shares. Together, they control about 20 percent of the company. Donnelly's more than 776,000 shares were worth about $16.3 million at yesterday's close.

A key investor, Genstar Capital LP of San Francisco, sold more than 1.6 million shares for $31.6 million. The private investment firm now controls almost 40 percent of PRA shares.

Genstar bought slightly more than 50 percent of PRA shares in 2001 when it invested $100 million in the company, teaming up with management to acquire control from District-based Carlyle Group.

Shares sold in yesterday's public offering represent about 25 percent of the company's equity.

This was PRA's second attempt to go public. Donnelly said the company called off plans for an IPO in 1997 because management decided to wait and take a larger company public later.

PRA earned $13.2 million on $290 million in revenue last year, up from a $5.6 million profit on $201 million in revenue in 2002. For the nine months ended Sept. 30, PRA posted a profit of $15.9 million on $229.7 million in revenue.

PRA is the second Washington area company to go public this week. On Tuesday, InPhonic Inc., a District-based reseller of wireless phones and services, sold 7.5 million shares, also for $19.

InPhonic closed yesterday at $24.79, down 59 cents.


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