KKR returns for a second helping of Australia's GenesisCare

The private equity firm will commit A$400 million ($283 million) for a 20% stake, with an option to invest another A$250 million. It is part of a capital raising exercise that includes a refinancing of debt facilities. These numbers were first reported by The Australian Financial Review and then confirmed to AVCJ by a source familiar with the transaction.

The new funding will go towards improving services within Australia, including regional and rural locations, continuing the roll-out of operations in Western Europe, and launching a China business with five initial projects in Beijing, Guangzhou, and Yunnan province. GenesisCare already treats more than 3,000 patients per day across 130 clinics, and it plans to open another 40 over the next three years.

The company is also working on new cancer therapies, taking the lead or participating in over 100 clinical trials. It has established strategic research partnerships with the likes of Telix Pharmaceuticals, Clarity Pharmaceuticals, and Varian Medical Systems.

“We see tremendous opportunities to accelerate the company’s plans and support the doctors and management to improve care and treatment models for patients with cancer or heart disease. We are also honored to partner alongside China Resources to bring the best of both organizations to support GenesisCare in its mission,” Scott Bookmyer, head of Australia at KKR, said in a statement.

KKR’s investment in 2012 facilitated an exit for Advent Partners, which had acquired a 32% interest in the company for around A$48 million in 2009. Despite agreeing to buy up to 63% of GenesisCare, KKR didn’t fully exercise that right and ended up with 45%. It reportedly paid an enterprise valuation of around A$600 million.

GenesisCare’s doctors and management retained majority control until China Resources and Macquarie took out the KKR stake and purchased additional equity that would give them between 50.01% and 74% of the company. The enterprise valuation at the time of sale was A$1.7 billion.

During KKR’s first investment period, GenesisCare established itself as the largest private provider of cancer and cardiac healthcare in Australia and Europe. Organic expansion was supported by M&A, with acquisitions of UK-based Cancer Partners and Spain’s IMOncology.

While the initial investment came from the KKR’s debut Asia fund, the private equity firm didn’t specify which vehicle would be utilized this time around. It said the investment would be made through KKR-managed funds and accounts. The transaction is subject to regulatory and shareholder approvals, including from Australia’s Foreign Investment Review Board.

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• Topics
• Australasia
• Expansion
• Healthcare
• Australia
• KKR
• Growth capital