AGIC makes first healthcare deal

The Hong Kong-based firm has acquired medical laser manufacturer Fotona, which will target expansion in China and Asia.

Asian-European private equity firm Asia Germany Industrial Promotion Capital (AGIC) has acquired Fotona, a US and Europe-headquartered manufacturer of high performance medical lasers – its first deal in the healthcare sector.

AGIC bought all of the shares of the business from Los Angeles-based investment firm The Gores Group for an undisclosed sum. Media reports however indicate the deal value between $100 million and $250 million.

AGIC, which in February hit amassed $1 billion for its debut fund, favours investments in European small- and mid-cap companies focused on high-tech intelligent manufacturing.

The firm has already made two investments from Fund I. It acquired German manufacturer KraussMaffei Group in January 2016 for €925 million and purchased Italian tools and robotics company Gimatic in June for €100 million.

Its investment in Fotona will be used to accelerate the company’s growth in China through increased focus and resource on sales and marketing, expanding its distribution network and obtaining regulatory clearances in the country, the firm said in a statement.

Established in 1964 Fotona designs and manufactures medical lasers used in aesthetics and dermatology, dentistry, surgery and gynaecology. Along with corporate headquarters in Dallas, Texas and Ljubljana, Slovenia, the company’s distribution network spans more than 60 countries.

“The investment in Fotona further demonstrates how AGIC, working with existing management, can provide the financing and expertise to enhance the value of fast growing companies with global aspirations,” Sam Sun, managing director and head of Greater China for AGIC, commented.

“Fotona has seen exceptional growth in Europe and the US, its largest market, and has a strong track record for delivering innovative product lines. China is now the fastest growing market for medical and aesthetic lasers and with our support, the business will be well positioned to become a leading brand across Asia,” Sun said.

According to research from consultancy Markets and Markets, the global medical laser market is expected to reach $2.3 billion by 2019 from $1.3 billion in 2014, growing at a compound annual growth rate of 12.1 percent in the five-year period. While North America holds the largest market share, Asia is the fastest growing market mainly because of the region’s unmet need for medical treatment in developing countries such as China and India.