Private Equity Deals & Transactions

Water Street starts spending $750m Fund III

The US firm has acquired a Danish clinical services business, less than a year after it raised its latest fund in just eight weeks.

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Water Street Healthcare Partners has bought a majority stake in CCBR-SYNARC, a Danish group specialising in outsourced clinical services. 

The deal was the first inked by Water Street’s Fund III, which closed on $750 million last year in less than two months. It was also the firm’s second investment in a European-based business. 

No financial details for the CCBR-SYNARC deal were disclosed, however a source close to the deal said the equity cheque was above the €100 million-mark.

Established in 1998, CCBR-SYNARC comprises two businesses that offer clinical services to pharmaceuticals and biotech groups. Its Copenhagen-based Centre for Clinical and Basic Research (CCBR) conducts and manages clinical trials in dedicated centres in Europe, South America and Asia; its SYNARC division, based in Newark, California, provides the imaging services, consultation and analysis at each stage of a trial’s life cycle. 

The group has around 500 medical staff, currently specialising in musculoskeletal, cardiovascular and neurological consultations and treatments. 

After a phase of strong initial growth, it now needed further network experience and financial backing to reach its next stage of development, Claus Christiansen, founder and chairman of CCBR-SYNARC, said in a statement. “Water Street’s experience in the pharmaceutical sector, business development expertise and extensive industry relationships will provide our businesses with the intellectual capital and resources to achieve long-term growth and success.”

Water Street believes the outsourced clinical services sector is due to see strong impetus in the coming years: it estimates annual growth to average between 5 to 10 percent over the next five years, as new regulations and global drug development protocols increasingly lead pharmaceutical companies to further externalise processes down the value chain. 

“CCBR-SYNARC stands out for its proven ability to both quickly recruit patients in targeted geographies and efficiently analyse images to support customers while increasing their clinical trial success rates,” commented Al Heller, an operating partner at Water Street. 

Water Street now has 12 companies in its portfolio, all operating in the healthcare sector. It manages around $2 billion of assets.