Private Equity News & Analysis

DW Healthcare wins 6.2x return on exit

The firm sold Verathon, a maker of ultrasound equipment, to Roper Industries for $300m. The healthcare private equity sector has seen increased activity as more deals come to market.

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Salt Lake City, Utah-based DW Healthcare Partners has achieved a 51 percent IRR on the $300 million sale of medical device company Verathon to Roper Industries as the market for healthcare deals heats up.

DW invested $34 million in Verathon along with co-investor Rho Capital in 2005, when the company was called Diagnostic Ultrasound. The exit has generated the firm a healthy 6.2 times return.

Verathon manufactures ultrasound equipment.

DW was founded in 2002 and collected $90 million for its debut fund. The firm raised $162 million for Fund II, and is reportedly in the market for its third fund.

Private equity firms have been involved in a slew of healthcare deals recently. Odyssey Investment Partners entered an agreement to buy medical cost management company One Call Medical from TA Associates Monday. No details of the transaction were available. The Bank of Ireland and GE Capital provided financing for the deal. TA led a $115 million buyout of One Call Medical in 2003.

Last week, Apax Partners sold Spectrum Holding, a provider of laboratory and disease screening services, to Welsh Carson Anderson & Stowe for $230 million. Also last week, mid-market player The Riverside Company bought PharmMD, a provider of medication therapy services, for an undisclosed amount.