Chris Evans, of venture capital company Merlin Biosciences and property entrepreneur Tom Hunter, of buyout firm West Coast Capital, have raised over £500 million ($991 million, €739 million) to provide the venture firm with growth capital, according to a source close to the fundraising.
The source said the fund was backed by investors in the two companies and institutional investors.
Unlike Merlin’s three previous venture capital funds the latest fundraising round is designed to target mature healthcare companies with investments ranging from between £30 million to £300 million, he said. Evans and Hunter have already identified five takeover targets, including two British companies, he added.
Evans is under investigation in the cash-for-honours inquiry by the City of London Police and the Serious Fraud Office. The businessman, with others, has been accused of loaning money to the Labour government to influence awards. Evans and Merlin have persistently denied wrongdoing.
The source said: “Major investors do not put their weight behind people they have any doubt about. They’re not investing in Merlin just out of sentiment.”
Hunter took a 20 percent stake in Merlin last year through his company, West Coast Capital.
Merlin has committed to 35 businesses, financing some notable bio tech venture capital investments, including funding rounds into pulmonary products company Vectura and vascular and cancer company Ark Therapeutics.
Hunter is considering taking on UK supermarket Tesco in the bidding for Scottish-based garden centre Dobbies. Earlier this month Tesco agreed to pay £15 a share, for Dobbies, valuing the company at £155.6 million. However, last week Hunter increased his stake in Dobbies to 20.6 percent which may stop Tesco acquiring the 75 percent acceptance from the company’s shareholders it needs to sanction its takeover bid.