ARCHIMED raises €3.5 billion for MED Platform II, a record for a buyout fund exclusively investing in healthcare industries
The oversubscribed fund, which will have a trans-Atlantic focus, closed above the private equity healthcare specialist’s initial €2 billion target after 17 months fundraising.
Global private equity healthcare specialist ARCHIMED announces the final closing of its fifth multi-asset fund, MED Platform II, on €3.5 billion ($3.75 billion). Main fund commitments amount to €3 billion with the remainder committed to a side vehicle for co-investment. The sum collected for the main fund represents a record for private equity buyout vehicles investing exclusively in healthcare industries, according to data from Preqin. The oversubscribed MED Platform II began fundraising in January, 2022 with an initial target of €2 billion but raised its target (or “hardcap”) twice to accommodate investors and cope with rich deal-flow.
MED Platform II is the successor to the fully invested MED Platform I which closed on commitments of €1.5 billion in 2020 – €1 billion for the main fund and €0.5 billion for co-investment – then records for a European-headquartered private equity healthcare specialist. In terms of performance, MED Platform I is a top decile 2019 vintage. MED Platform I has returned two thirds of invested capital to investors and its total return exceeds 2x MOIC (multiple on invested capital).
MED Platform II attracted new investors from all regions of the world on top of an investor re-up rate (from existing investors in MED Platform I) of almost 100 percent. Among the wide range of institutional investors and family offices investing in the fund, 40 percent come from Europe, 30 percent come from North America, and 30 percent are based elsewhere, especially in Asia. MED Platform II is targeting 14 investments versus the seven MED Platform I invested in.
The MED Platform funds partner with category leaders in the European and North American mid-cap healthcare industries, buying majority stakes alongside family owners, founders and managers. The funds provide platform companies with the strategic, tactical and financial resources they need to accelerate innovation, grow capacity, broaden product lines and expand into new regions, organically and through acquisitions.
Over the past year, MED Platform II has deployed close to €1 billion (out of the €3.5 billion total) in formerly Nasdaq-listed Natus (through a $1.2 billion take-private deal), a global leader in neuro-diagnostics, and in Plasmid Factory, a German developer of exceptionally high-grade plasmids (an efficient means to modify genes and cells to combat maladies).
“Working in partnership, we use financial muscle, healthcare knowledge and global connections to realize bold strategies for innovative category leaders in fragmented sectors,” says André-Michel Ballester, Managing Partner. Adds Managing Partner Vincent Guillaumot: “Investors clearly appreciate ARCHIMED’s specialist edge in a challenging fundraising environment.”
ARCHIMED recorded a string of five high-multiple exits in the last 18 months, all sold for 3x to 6x MOIC. ARCHIMED’s record-beating sale of Polyplus to Sartorius for more than 300x MOIC is expected to close by year-end.
The fully invested small cap-focused MED I fund (raised in 2014), which recorded the Polyplus return, is ranked the best performing buyout fund on a global level for its vintage year, according to Preqin, returning 7 times invested capital (of which close to 5x is already distributed). ARCHIMED’s next two funds – also fully invested – MED II (raised in 2018) and MED Platform I (raised in 2019) are both top decile performers. ARCHIMED is currently investing small cap-focused MED III (raised in 2021), in addition to MED Platform II.
“Like its predecessor, MED Platform II offers more than just financial backing, Most of the ARCHIMED team have medical, scientific or operational backgrounds so we fully appreciate the lofty ambitions of our partners, as well as the challenges they face.”
Denis RIBON, ARCHIMED Chairman and Managing Partner