ArchiMed will finance ambitious industry consolidation and organic expansion for SUANFARMA, with the aim of making it the leader of its industry.
Trans-Atlantic private equity healthcare specialist, ArchiMed announces the acquisition of a majority stake of Madrid-based SUANFARMA through its €1 billion MED Platform I fund (MPI). SUANFARMA, founded in 1993, is a manufacturer and distributor of some 890 active pharmaceutical ingredients (APIs) and more than 1,100 nutraceuticals, sold in over 70 countries worldwide. Active pharmaceutical ingredients are the therapeutic constituents of drugs. Nutraceuticals are food substances that provide either medical or health benefits.
Ares Management Company provided the debt for the deal. ArchiMed’s majority stake is held directly by MPI and through a dedicated co-investment vehicle funded by ArchiMed investors. SUANFARMA founder, Hector Ara, and managers rolled between 50 and 100 percent of their SUANFARMA proceeds back into the firm for a significant, double-digit minority stake.
“Given the increasing outsourcing of API and nutraceutical services, the new strategic need for better global supply chain control and an exceptional number of complex ingredients coming off patent, we see fantastic opportunities for manufacturing and distribution excellence in this sector.” says ArchiMed Managing Partner André-Michel Ballester. “SUANFARMA’s management has the experience to manage an aggressive consolidation of the fast-growing markets for APIs and nutraceuticals. They’ve also got that rare level of expertise and industry intelligence to develop a full suite of complex APIs and nutraceuticals at a time when leading pharma companies are looking for one-stop shopping.” “ArchiMed is an industry specialist with an appreciation of the unique opportunities we can benefit from,” says SUANFARMA CEO Francisco Fernandez. “Allied with them, we’ve got the resources to be the leading global developer, manufacturer and distributor of active ingredients for the pharma, veterinary and nutritional sectors.”
SUANFARMA’s net sales - forecast to reach close to €300 million in 2021 - have increased almost 20 percent annually for three years, with an above industry-average EBITDA margin. One priority of ArchiMed and SUANFARMA management is accelerating sales and profit growth by sourcing more vital ingredients globally. This will reduce the long-distance supply chains that caused drug shortages in Western markets during the Covid-19 pandemic.
MPI owns four additional platforms: Italy-based Bomi Group, Europe's leading healthcare-specialist contract logistics organization; US-based NAMSA, the world's preeminent contract research organization for Medtech; UK-based DHG, a North European leader in hospital equipment; and Stragen, a Swiss-based developer of hard-to-make generic drugs. With SUANFARMA’s purchase, MPI has invested over 70% of the €1 billion it raised through its final close in August 2020. ArchiMed also manages MED I, currently ranked the best performing buyout fund at a global level for the 2014 vintage, according to Preqin data. MED I has distributed more than four times invested capital to limited partners and has a total return in excess of six times invested capital.
About ArchiMed - www.archimed.group
With offices in the US and Europe, ArchiMed is a leading investment firm focused exclusively on the healthcare industries. Its mix of operational, medical, scientific and financial expertise allows the ArchiMed team to serve as both a strategic and financial partner to European and North American small and middle-market businesses. Prioritized areas of focus include biopharmaceutical products & services, life science tools, medical devices & technologies, diagnostics, healthcare IT and consumer health. ArchiMed helps partner companies internationalize, acquire, innovate and expand their products and services. Over the last twenty years, ArchiMed’s leadership team has directly managed and invested in over eighty small to large-size healthcare companies globally, representing over €50 billion of combined value. ArchiMed manages over €3 billion ($3.4 billion) in healthcare assets across its various funds. Since its inception, ArchiMed has been a committed Impact investor, both directly and through its Eurêka Foundation.
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