EQT doubles down on healthcare with Life Sciences Partners buyout
18 November 2021
The ink in EQT ’s checkbook is still not quite dry from the $8.5 billion it and Goldman Sachs spent on CRO Parexel back in March, but it will need a fresh page as it snaps up a major European healthcare venture capital firm.
There’s around $520 million (450 million euros) coming upfront from investment firm EQT to buy Life Sciences Partners (LSP), made up of 25% cash and 75% EQT AB publicly traded shares, with 25 million euros also up for grabs “if certain short-term fundraising targets are met.”
Amsterdam-based LSP currently has around 2.2 billion euros under management and, for the past 23 years, has been making life science bets in Europe and beyond, now reaching 150 companies.
Under the deal, EQT also nabs 20% of the right to carried interest in select LSP funds and can get 35% of the carried interest of future funds; EQT is predicting around 37 million euros in revenue from LSP this year.
The entire LSP team, including all partners and employees, will join EQT when the deal closes.
“EQT has a long history of developing strong healthcare companies, and today we are one of the largest and most active private equity investors in the sector globally,” said Per Franzén, partner and head of EQT Private Capital.
“Integrating LSP within EQT’s Private Capital platform will bring compelling cross-pollination opportunities for our other strategies and complement our sector expertise—making EQT an even better and more innovative healthcare investor.”
This comes around half a year after EQT and U.S. financial giant Goldman Sachs joined forces to take over major CRO Parexel, spending $8.5 billion in doing so and displaying the attractiveness of the life sciences sector to big players.
“The partnership with EQT not only accelerates LSP’s growth opportunities in an unprecedented way but also guarantees the long-term continuity of LSP’s active role in the life sciences industry in Europe and beyond,” added Martijn Kleijwegt, founder and managing partner at LSP.
“Having started the firm in 1998, I feel proud to have built the firm with all the partners and other colleagues, and I feel very good about where it has landed today.”
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Also published on Fiercebiotech.com