Deal in focus: GC Aesthetics receives $60m lift

In late February, Dublin-based GC Aesthetics secured $40m in funding from new investor Orbimed and a further $20m from existing investors Montreux Equity Partners and Oyster Capital.

While management was keen to secure the growth capital required for supporting its ambitious plans (targeting growth of 30% per annum over the next three years), it was vital to find the right investor to work with, says company CEO Ayse Kocak: "We had set ourselves a deadline to close the fundraising at the end of 2013 or in early 2014. But, it wasn't about rushing to bring in any money, it was about finding the right partner; we went through the process at our own pace and were able to be selective over who we decided to work with."

GC Aesthetics was established in 2007 and has experienced impressive growth since. Its breast implants are today sold in 90 countries and its product range includes 600 types of implants. GC's key brands are UK-based Nagor and France-based Eurosilicone.

Over the next three years the business will expand into new markets and streamline operations in markets where products are sold through distribution partners.

TechNavio, a technology research and advisory company, forecasts that the breast implant market will achieve a compound annual growth rate of 6% between 2014 and 2018. According to Kocak, there are two key geographies currently witnessing fast growth in the breast implant market: Latin America and Asia Pacific. "Mexico is the number two market for implants and we've just had approval of our Eurosilicone products so will be focusing on expanding our presence with patient programmes and surgeon tools. Korea and Thailand are other important territories in Asia Pacific; they are major hubs for medical aesthetics in Asia and we intend to grow market share there also."

Rigorous regulation
As GC Aesthetics sits in a highly regulated market, with each jurisdiction demanding various levels of health and safety requirements, one of Kocak's main priorities is to ensure that the company's product range meets all demands and upholds its brand values of providing a high-quality product. "Registering and gaining approval for products is one of the main challenges of operating in this market but fortunately due to our longevity in the market [Nagor and Eurosilicone collectively have 60 years of market experience] we have a strong track record of product data available," explains Kocak.

Despite the attractive growth fundamentals of the breast implant market, driven by rising consumer spend in the space, potential investors could be put off by ethical concerns LPs may have around the industry following the PIP breast implant health scare in 2012, where the implants had been made from unauthorised silicone filler and had double the rupture rate of other implants. Fortunately, GC Aesthetics' new investor Orbimed has already made a similar investment in a US-based company.

Finding an investor comfortable with the space that GC Aesthetics operates in, and one that could get behind the company's growth plans were Kocak's key tasks when raising funds. Rather than bringing in any advisers to support the process, it was GC Aesthetics' existing investors that introduced Orbimed to the business. "We met them and explained our vision and business plans. Through numerous conversations, we agreed this partnership could be very positive. It felt right from the beginning and we are looking forward to a bright future," says Kocak.

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Montreux Private Equity – Daniel Turner

This deal was originally covered on 20 February 2014

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