Cerberus May Be Looking to Sell Talecris Biotherapeutics

Implications: If a report in the Financial Times is credible, the already consolidating plasma products industry could render down to even fewer players in the near future with the sale of Talecris to a major competitor. The value of the company will be strongly influenced by the direction in demand for its industry's leading product:  intravenous immunoglobulin (IVIg).

Analysis: Talecris is among the three leading U.S. suppliers of plasma products, most prominently IVIg, human albumin, alpha-1 proteinase inhibitor and factor VIII.  The other two dominant entities are Baxter Healthcare and the Australian conglomerate CSL.  Talecris' revenues grew nearly 10% between 2006 and 2007 to $1.2 billion, generating nearly $265 million in EBITDA last year.

Having pulled back an IPO offering in last year's unfavorable market, majority owner Cerberus Capital may be looking at an outright sale of the company to add to its return on investment and generate needed cash.

While Talecris is currently working its way through a significant production hiccup, it is temporary.  The potential for future revenue growth and profitability for this operation has much to do with the future direction of the all-important U.S. and international IVIg market.