HgCapital has sold Mercury Pharma, the UK-based speciality pharmaceutical company, to Cinven, the European private equity firm, for GBP465m.
Following the sale of Mercury Pharma, 20 per cent of invested capital will have been realised by the HgCapital 2009 vintage fund, HgCapital 6.
Since the start of the global economic downturn in Q3 2008, HgCapital has realised a total of 15 investments, returning approximately GBP1.6bn in proceeds to clients.
HgCapital’s 2006 vintage fund, HgCapital 5, has already returned more than 120 per cent of invested capital to date, from only five full and one partial exit including SLV (4.0x original cost, 45 per cent IRR), Visma (4.1x original cost, 34 per cent IRR) and SHL (3.1x original cost, 25 per cent IRR).
Mercury Pharma is a speciality pharmaceutical company focused on the sale of niche prescription off-patent products. Mercury Pharma’s portfolio is underpinned by strong intellectual property rights with 91 per cent of revenue from owned-IP products. Based in the UK, the company was founded in 1989 and was listed on the London Stock Exchange from 1998 to 2009. It has 187 employees worldwide, including an operations centre in India and a direct sales presence in the UK, Ireland and the Netherlands.
Mercury Pharma was acquired by funds managed by HgCapital in December 2009 in a complex public to private transaction. Mercury Pharma has nearly doubled EBITDA under HgCapital’s ownership.
Philipp Schwalber, head of HgCapital’s healthcare team, says: “Mercury Pharma is the first exit for HgCapital 6, the second realisation by HgCapital’s healthcare team in the last two years, and the most recent in a long line of public-to-private success stories for HgCapital. We initially identified the speciality pharmaceutical niche in 2007 and tracked Mercury Pharma for a number of years before launching our public-to-private offer in 2009. The realisation of Mercury Pharma marks the continued development of HgCapital’s investment focus in the healthcare sector, as we continue to seek out businesses that enjoy niches of secular growth despite the challenges facing much of the healthcare space.”
