Investment funds target medical companies

 

The deal, which includes the takeover of controlling interest for some €8-9 million, with a further €5 million capital injection, is currently being analyzed by the Competition Council.

According to market sources, GED would be acquiring 78.93 percent, and former shareholders will remain involved in the business.

Besides GED Capital, other investment funds were recently involved in talks relating to the acquisition of health companies. Advent and Nycomed funds were interested in the purchase of the Ozone sales & marketing company, according to sources on the mergers&acquisitions market.

“The medical services industry is less affected by recession. At a time when the government is facing so many problems in the public health system, the significance of the private medical sector is rising,” GED Capital Managing Director for Eastern Europe, Robert Luke, told Business Standard.

Contacted by Business Standard, Diamedix Economic Manager, Traian Marinescu, did not confirm the deal. Luke declined to comment on the Diamedix deal, citing confidentiality issues. However, he did tell Business Standard that the fund’s interest in the medical sector is not limited to Diamedix. GED Capital was previously involved in the health industry, as shareholder in local Sicomed pharmaceutical producer. GED Capital, along with the Global Finance investment fund, exited the company in 2005, when they sold controlling interest to Czech Zentiva producer.

Medical services and medical equipment suppliers are among the resilient sectors during this economic crisis, which has a depreciating impact on economy segments, albeit different from sector to sector” the representative of a major investment fund said.

Diamedix, founded in the 1990s, imports and distributes medical equipment for laboratories, and rapid testing for labs and medical practices. The company has more than 40 employees and a nationwide distribution network, with operations in Bucharest and major cities, such as Cluj-Napoca, Brasov, and Timisoara. Its turnover amounted to €5.8 million in 2007, when it posted €0.9 mln in turnover. Its current shareholders are Greek businesspeople Nikolaos Papadopoulos (29.98 percent of shares) and Vasileios Chrelias (70.02 percent of shares).

Founded in 1996, GED is one of the leading independent mid-market private equity firms operating in Southwestern (Spain and Portugal) and Southeastern Europe (Romania and Bulgaria), managing some €350 million through four different equity funds.

Besides investment funds, pharmaceutical companies are also interested in acquisitions. Last year, Swiss Roche company acquired a local medical equipment distributor, Top Diagnostics, for €20 million, according to Business Standard sources. The amount has not been confirmed by the companies.