Swiss biotechnology company Lonza will acquire Capsugel from investment firm KKR for $5.5 billion, including the refinancing of $2 billion in existing Capsugel debt.

The $5.5 billion all-cash acquisition will be financed with a combination of debt and equity financing. Lonza has committed debt financing for the full acquisition amount from Bank of America Merrill Lynch and UBS and plans to raise equity, which is fully underwritten by UBS and BofA Merrill Lynch for an amount up to CHF 3.3 billion ($3.2 billion).

The transaction has been approved by the boards of directors of both companies. The transaction will be financed with a combination of debt and equity financing. The EV/adjusted EBITDA multiple for the transaction adds up to 15.1x based on the last 12 months adjusted EBITDA figures up to September 2016.

Richard Ridinger, CEO of Lonza, said, “The acquisition of Capsugel meets Lonza’s strategic and financial goals. It accelerates our healthcare continuum strategy by giving us broader exposure to the fast-growing pharma and consumer healthcare markets. We expect the transaction to be accretive to our core earnings per share in the first full year post closing.”

The financial package foresees the refinancing of Lonza’s current CHF 700 million ($680 million) revolving credit facility.

Basel-based Lonza Group is a supplier to the pharmaceutical, biotech and specialty ingredients markets.

Morristown, NJ-based Capsugel designs, develops and manufactures a wide range of innovative dosage forms for the biopharmaceutical and consumer health and nutrition industries.

KKR is a global investment firm that manages investments across multiple asset classes.