The price obtained by MedLife’s owners reflects an operating profit multiplier of over 11, unusual for this period of crisis, which led to the collapse of this indicator to some 3-6. Thus, the high level of this multiplier indicates the special interest of investors in the medical service sector, considered to be a segment less affected by the economic downturn. According to sources close to the deal, another investor on the short list for acquiring MedLife stock was AIG Investment, but the American fund targeted a majority package.
The value of the transaction between Société Générale Asset Management and MedLife is equal to the sum of all other transactions made this year by another private equity investment fund. The private equity investment market fell 6.5 times this year compared to 2008 and almost 12 times compared to 2007. Two years ago, the investments of private equity funds on the local market reached a high of €476 mln.
Mihai Marcu, the founder of MedLife, announced at the end of April that he intended to sell a package of 20-30 percent of the company to develop other family businesses, retaining a majority package. The Marcu family owned 80 percent of MedLife, with the remainder belonging to IFC, the investment division of the World Bank. MedLife ended 2008 with net sales worth €21.2 mln, up 67 percent year-on-year, and expects €31.5 mln in turnover this year. The local private medical service market is valued at €430 mln, and has an annual growth rate of some 20 percent.
The latest large transactions in the local healthcare sector were the 3i investment fund becoming shareholder of CMU, the takeover of 65 percent of Hiperdia by the Southeast European Equity Found II - SEEF II investment fund, and Euromedic’s entrance on the dialysis market, by taking over Nefromed.
