Financière Arbevel gears up for new life sciences fund first close

Arbevel Life Sciences Crossover II will target EUR 100m and aim for a second close next year.

Investors in the vehicle are all French, with many having already invested in the fund’s predecessor, Arbevel Life Sciences Crossover I, he said. New institutional investors are also expected to join in, including regional entities of French banks.

Fund I was established in 2018 and collected a total of EUR 40m entirely deployed by 2021, Le Bozec said. It invested in health-focused companies with small revenues to support them accelerate sales, he said. It deployed between EUR 1m and EUR 4m in each company, he added.

The fund had the backing of by French LPs and registers around 20% IRR, he said.

Investment plans
Fund II will mainly target pre-revenue companies operating in the French health sector and will focus on medtech along with diagnostic and health services experts, he said.

The Paris-based fund has already identified four potential investments for the vehicle, with the first investments expected before the end of this or year or in 1Q23, Le Bozec said.

ALSC II will be deployed across 12 deals over three years. Its average ticket will be between EUR 8m-10m, he added.

Financière Arbevel mainly invests in minority stakes, Le Bozec said, adding that it plans to have at least one seat on the board of each of its portfolio companies.

It mandates M&A advisors on a case-by-case basis and has worked with Jones Day, EY, White & Case, Lazard and Edmond de Rothschild among others in the past, Le Bozec said.

Fund II plans to exit companies after four to five years, aiming for 2-3x times money minimum when exiting, he said.

During its investment period, the firm will help companies with a low valuation to achieve higher financial status in order to later be able to partner with growth investors such as Apax, KKR or Ardian, he said.

Exits
Financière Arbevel is currently working on three Fund I exits, Le Bozec said, declining to give further details. The vehicles aims to sell for 2-5x times money on average, he added.

This summer, TransCure bioServices, a contract research organization (CRO) specialised in full human immune system and hu-liver mouse models backed by Financière Arbevel in a EUR 2.5m deal in 2019, received an investment from French private equity firm Cathay Capital.

Fund I also invested in NH TherAguix, a French biotechnology company specialised in nanomedicine for cancer radiotherapy treatment. It plans to reinvest when the company will complete its upcoming EUR 40m Series B funding round, as reported.

Established in 1997, Financière Arbevel was acquired by its current management, chairman Jean Baptiste Delabare and CEO Sébastien Lalevée, in 2007. It has around EUR 3.2m under management and 46 employees, including five private equity specialists, Le Bozec said.

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