Hospital sign

Palamon secures 3x return from Prospitalia exit

Thu, 17/07/2014 - 12:07

PS Sà rl, which is majority-owned by the funds managed by private equity firm Palamon Capital Partners, has sold its investment in PS TopCo GmbH to an undisclosed investor. 

PS TopCo is a parent of Prospitalia.  Over the term of its investment in PS Sà rl, Palamon has generated a return of 3.0x on capital invested.
 
Prospitalia is a group purchasing organisation (GPO) in Germany, providing procurement services to more than 900 hospitals and healthcare facilities across the country to help lower the cost of goods purchased.  The company currently reports a pooled purchasing volume of EUR1.2 billion. 
 
Palamon originally invested in PS S.à r.l. when the majority of acute hospitals did not use GPO services, with the thesis that significant additional market penetration was inevitable as pressures on healthcare budgets would necessitate cost saving measures.  Purchasing volumes for German GPOs are reported to have grown between five per cent and 10 per cent per year, and today surveys show that more than 60 per cent of German acute hospital beds are served by GPOs.
 
Healthcare is an important investment theme for Palamon, which has committed more than EUR200 million to the sector over the past seven years. 
 
Pascal Noth, partner at Palamon, says: “We are delighted with the success of our investment in Prospitalia, which has returned 3.0x on invested capital.  Prospitalia is the number one GPO in Germany and has built out its position with a strong reputation for the quality of services it provides.  We thank the management team for driving the business to where it is today and wish them well for the future.”
 
Palamon has completed eight realisations from its EUR670 million 2006 fund, Palamon European Equity II, which has to date produced proceeds of EUR708 million at a return of 2.8x multiple of invested capital on fully exited companies.  


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