Cencora acquires RCA in $4.6bn transaction

BY Fraser Tennant

In a deal that expands its speciality services, drug distributor Cencora is to acquire Retina Consultants of America (RCA) from private equity firm Webster Equity Partners for $4.6bn.

The acquisition of RCA – a management services organisation (MSO) that operates a network of retina specialists – will add to Cencora’s specialty capabilities and expand its business, broadening physician and manufacturer relationships as well as Cencora’s value proposition to all its stakeholders.

Cencora plans to fund the transaction through a combination of existing cash on hand and new debt financing. RCA’s affiliated practices, physicians and management will retain a minority interest in RCA, with Cencora holding approximately 85 percent ownership in RCA upon closing.

“The acquisition of RCA will allow Cencora to broaden our relationships with community providers in a high growth segment and build on our leadership in specialty,” said Bob Mauch, president and chief executive of Cencora. “With a compelling value proposition for physicians, an impressive leadership team and strong clinical research capabilities, RCA is well-positioned at the forefront of retinal care.

The leading MSO in the retina space and a trusted healthcare provider, RCA’s nearly 300 retina specialists across 23 states provide high-quality care to patients with physicians conducting over 2 million visits annually.

Cencora expects to use its suite of manufacturer services to enhance RCA’s research programme and outcomes, maintaining its position as a partner of choice to pharmaceutical innovators in the retina space.

“We are pleased to enter our next phase of growth with the support of a leading global pharmaceutical solutions organisation,” said Robby Grabow, chief executive of RCA. “With additional resources to support the continued execution of our growth strategy, we will be better positioned to continue expanding our physician network and enhancing the quality of care we provide.”

The transaction is subject to the satisfaction of customary closing conditions, including receipt of required regulatory approvals.

Mr Mauch concluded: “The addition of RCA will allow us to expand our MSO solutions and drive differentiated value across the healthcare system for manufacturers, providers and patients.”

News: Cencora bolsters specialty business with $4.6 bln deal for Retina Consultants of America

Sanofi to sell Opella to CD&R in €16bn deal

BY Fraser Tennant

In a transaction with an enterprise value of €16bn, French drugmaker Sanofi is to sell a 50 percent controlling stake in its consumer health business Opella to US private equity firm Clayton Dubilier & Rice (CD&R).

CD&R’s acquisition of Opella paves the way for the creation of a new, standalone leader in consumer healthcare, while supporting Sanofi’s strategy and increased focus on innovative medicines and vaccines.

French public investment bank Bpifrance is expected to become a minority shareholder, taking a stake of around 2 percent and a seat on the board of Opella.

“This is an exciting opportunity for CD&R to partner with Sanofi, one of the world’s leading healthcare companies,” said Eric Rouzier, partner and head of European Healthcare at CD&R. “Opella is differentiated by the quality of its brand portfolio and its highly skilled and motivated workforce.”

Headquartered in France, Opella employs over 11,000 people and operates in 100 countries with 13 manufacturing sites and four science and innovation development centres. With a portfolio of iconic brands, such as Allegra, Doliprane and Dulcolax, Opella is the third-largest business worldwide in the over-the-counter and vitamins, minerals and supplements market, serving more than half a billion consumers worldwide.

“This acquisition is a major and exciting milestone in Opella's journey,” said Julie Van Ongevalle, president and chief executive of Opella. “Partnering with CD&R will allow Opella to unlock its full development potential, to further drive value creation and deploy the exceptional talent of our teams to become a leading company in the fast-moving consumer healthcare space.”

The transaction, which is expected to close in Q2 2025 at the earliest, is subject to finalisation of definitive agreements, completion of the appropriate social processes and customary statutory approvals.

“We are proud of what Opella and its inspired people have already accomplished and are confident that the future will be even brighter,” concluded Mr Hudson. “We share the love and emotional attachment to Opella’s brands, hence our decision to remain vested in its future.”

News: Sanofi reaches deal on terms of sale of consumer health arm, say French government sources

EQT and others acquire Nord Anglia Education in $14.5bn deal

BY Richard Summerfield

Swedish private equity firm EQT, Neuberger Berman Private Markets and the Canada Pension Plan (CPP) Investment Board have agreed to acquire international schools operator Nord Anglia Education in a deal worth $14.5bn including debt.

The deal will see the EQT-led consortium acquire a majority stake in Nord Anglia, which operates over 80 schools in 33 countries and educates more than 85,000 students worldwide.

Existing owners EQT and CPP Investments will remain shareholders in the company through a new fund investment and reinvestment, respectively, the firms noted in a statement announcing the deal. Nord Anglia’s relationship with EQT began with the firm’s initial investment in 2008. In 2017, EQT strengthened its commitment by increasing its stake in the company and welcoming CPP Investments as a partner. EQT is investing in Nord Anglia through its BPEA Private Equity Fund VIII.

“Nord Anglia’s extensive track record and unwavering commitment to supporting over 85,000 students worldwide uniquely positions the company for future growth,” said David Stonberg, managing director at Neuberger Berman. “We are honored to lead a consortium of investors who share our passion for delivering exceptional educational experiences.”

“We are excited to partner with the EQT team, whose deep industry expertise and proven collaboration with Nord Anglia’s management enhance this investment,” added Jonathan Shofet, managing director at Neuberger Berman. “Together with CPP Investments, we aim to support Nord Anglia’s mission of delivering world-class education.”

“EQT has had the privilege of partnering with Nord Anglia since 2008, and we’ve developed a deep connection with this exceptional business,” said Jack Hennessy, a partner within the advisory team at EQT. “Over the years, we’ve witnessed Nord Anglia grow from six schools to more than 80 which today serve more than 85,000 students across the globe. Alongside this growth, we’re proud to have helped elevate teaching excellence through industry-leading partnerships established under our ownership. With today’s announcement, we are thrilled to continue this journey with Neuberger Berman, CPP Investments, and our global institutional co-investors, and support Nord Anglia’s continued success and innovation in the global education space.”

“Nord Anglia was CPP Investments’ first direct equity investment in the private education sector, and we are proud to have been a partner, alongside EQT, in its growth globally over the years,” said Caitlin Gubbels, senior managing director & global head of private equity at CPP Investments. “Our reinvestment allows us to remain committed to Nord Anglia while delivering an attractive return to the CPP Fund. We are highly confident in the growth potential of the sector and look forward to working with new investors.”

“Families choose our schools because we help our students gain the academic outcomes, confidence, and life skills they need to succeed in the future,” said Andrew Fitzmaurice, chief executive of Nord Anglia Education. “At the heart of our students’ achievements are our high-quality teachers. Our ability to attract and develop outstanding teachers sees us receive over 60 applications for every teaching vacancy, reflecting the strength of our world-class professional learning program and career pathways.”

He continued: “Since day one, EQT and CPP Investments have shared our educational philosophy and with the addition of Neuberger Berman, we are further strengthening this successful partnership. Focused on improving students’ outcomes, we will accelerate our research of new teaching and learning practices, curricula innovation, and the growth and development of our global teaching community.”

News: Sweden’s EQT, others to take control of Nord Anglia for $14.5 billion

TPG and GIC acquire Techem in €6.7bn deal

BY Fraser Tennant

In what is its largest transaction to date, US asset manager TPG is to acquire German metering firm Techem from Switzerland’s Partners Group in a transaction valued at approximately €6.7bn.

TPG, through its dedicated climate investing strategy TPG Rise Climate, is acting as lead investor, with Singapore’s sovereign wealth fund GIC taking a significant minority stake.

The purchase price for Techem will be paid in two instalments, one at the close of the transaction, which is expected in the first half of 2025, and the remainder in July 2027.

Founded in 1952, Techem has built one of the largest digital energy services platforms in the industry. The company is active in 18 countries and services more than 13 million dwellings, with over 62 million digital measuring devices on its platform.

Techem’s services also help to advance the long-term decarbonisation of the real estate sector, which still drives approximately 40 percent of global CO2 emissions.

“Techem’s technology, transparent consumption statistics, and streamlined solutions for tenants, managers and asset owners alike are essential solutions for lowering costs and improving the environmental impact of real estate assets across Europe,” said Ed Beckley, managing partner of TPG Rise Climate. “There is a tremendous opportunity to reduce energy consumption in built environments by enhancing efficiency and better-managing overall demand.”

As a result of strong development over the past years, Techem has exceeded the €1bn revenue mark – with new digital services and broader decarbonisation services presenting future growth opportunities.

Techem intends to build on this foundation with its new partners TPG and GIC and further expand its ‘One Digital Platform’, leveraging the power of digitalisation to unlock significant energy efficiency potential in the building sector, optimise operational processes, and increase the living comfort of residents.

“With TPG and GIC, we are gaining strong new partners with the digitaisation and platform expertise needed to help us make significant progress in implementing our corporate strategy,” said Matthias Hartmann, chief executive of Techem. Together, we want to further expand and advance our position as a leading platform for digitalising and decarbonising the building sector across Europe and beyond.”

The transaction is subject to customary conditions and regulatory approvals.

Mr Hartman concluded: “We are very grateful to Partners Group and its co-investors CDPQ and Ontario Teachers’ for the trustful exchange and collaboration on the development of the company over the past years and look forward to building on our success with TPG and GIC.”

News: TPG and GIC to lead €6.7bn acquisition of Techem with backing from Canadian pension funds

KKR closes $4.6bn North American focused fund

BY Richard Summerfield

Private equity (PE) powerhouse KKR and Co has announced the final close of KKR Ascendant Fund SCSP, a $4.6bn fund dedicated to investing in middle market businesses in North America.

The fund, which was launched in 2022, is the first KKR vehicle solely focused on opportunities in the middle market and will target established companies with strong growth potential across seven industry verticals: consumer, financial services, healthcare, industrials, media, software and tech-enabled services.

“We are very proud of the strong response we have received from our fundraising efforts and believe that Ascendant is well-positioned to address the robust and attractive opportunities in the North American middle market,” said Pete Stavros and Nate Taylor, co-heads of KKR Global Private Equity. “We have long invested in this space in our Americas Private Equity funds and have found that we can harness KKR’s unique resources and expertise in value creation to deliver highly differentiated business outcomes. We wanted to launch a fund dedicated to this segment so that our investors could directly participate in the compelling outcomes we believe we can continue to deliver in the middle market.”

“Broad-based employee ownership and engagement programs are a key part of how KKR creates and maintains value across our portfolio companies,” said Nancy Ford and Brandon Brahm, co-heads of KKR’s Ascendant strategy. “Having seen the great success of these programs in other areas of KKR’s portfolio, we are thrilled that Ascendant will build on that strong foundation. These programs, which provide both equity ownership to employees and a strategy to enhance employee engagement, are implemented with the goal of creating aligned interests and enabling all employees to participate in the investment outcomes their work creates.”

The Ascendant fund, which was oversubscribed at the time of its closing, received backing from a range of investors, including public pensions, family offices and insurance companies. To date, the fund has struck six deals for companies including software provider Alchemer, dental care chain 123Dentist, and fire equipment provider Marmic Fire & Safety.

In a break from PE tradition, KKR has pledged to offer equity to employees of all its North America portfolio companies from the new fund. Typically, such an offer is usually reserved only for senior executives. However, over the last decade, emboldened by the firm’s investments in the industrial sector which began using the model, KKR has since expanded the employee ownership programme to more than 50 of its portfolio companies, awarding billions of dollars of equity to more than 110,000 employees. The firm believes it leads to higher revenue, improved productivity and lower turnover within its portfolio companies.

KKR, which had $601bn in assets under management (AUM) as of the end of June, has been attempting to raise capital at a difficult time for fundraising for large buyout firms. Limited partners have been unenthusiastic about making new commitments. PE firms have struggled to return capital amid persistently high interest rates, which have made selling companies to other buyout firms or refinancing companies challenging. However, after the Federal Reserve recently cut US borrowing rates, there is an expectation that PE-backed deal volume will begin to climb again.

News: KKR raises $4.6 billion for debut North America mid-market deals fund