Capricorn to seek $450m for healthcare – exclusive

The mid-market investor will launch its next flagship before December, Private Equity International has learned.

Capricorn Healthcare & Special Opportunities is planning to return with its third fund in the second half of this year, Private Equity International has learned.

The Palo Alto-headquartered mid-market firm will target $450 million for Capricorn Healthcare and Special Opportunities III, according to a source with knowledge of the firm.

Capricorn declined to comment.

The firm looks at North American buyout and growth equity opportunities requiring $20 million to $100 million of capital, according to its website. Its previous vehicle – for which it raised $357 million in 2016 – is understood to be almost fully deployed.

Metric Point Capital will act as placement agent for the new fund, the source added.

Private equity firms completed 130 healthcare deals in North America last year, the most since 2010, according to Bain & Co’s Global Healthcare Private Equity and Corporate M&A Report 2018. A dearth of mega-deals saw total disclosed deal value fall 22 percent to $22.1 billion, from $28.4 billion in 2016.

“Undeterred by legislative uncertainty, stiff competition and high valuations, PE funds found myriad opportunities in North America in 2017,” the report said. “Even with the ongoing debate about the future of the Affordable Care Act in the US, investors from around the globe remained confident that healthcare investments in the world’s largest economy would continue to produce strong, recession-resistant returns.”

Seven of the 10 top exits globally involved North America assets in 2017, including JLL Partners’ $7.2 billion sale of pharma business Patheon to Thermo Fisher Scientific and TPG’s sale of Surgical Care Affiliates, which provides outpatient surgical services, to UnitedHealthcare’s Optum unit for $2.3 billion.