G Square closes third fund on €500m

Katharine Hidalgo
14 January 2020

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Healthcare-focused investor G Square Capital has closed its third-generation fund on тЌ500m.

The fund was registered in May 2018 with a target of €450m and held its first close on €450m in September that year. The fund reached its target in September 2019. The fund is structured as a UK LP.

Its predecessor, G Square Capital II, closed on €350m in 2017 and has seven investments.

While the management and carry schemes for the fund are in accordance with market standards, the hurdle rate is lower than normal.

Asante Capital acted as placement agent, while Proskauer provided legal advice.

The healthcare industry has proved a particularly attractive investment theme in the current challenging economic climate, where the forecast downturn has persuaded investors to focus on resilient sectors able to deliver profitability even in a less favourable scenario. Healthcare-focused funds that held successful closes in the past year include Gilde Healthcare Services III, which held a first and final close on its hard-cap of €200m in March; Medixci III, which closed on €400m in July; and most notably GHO Capital Fund II, which reached its €975m hard-cap in late November.

Investors
The fund saw around 40 existing and new LPs from Europe, the US, Japan and Australia participate. Investors in the fund include Adams Street Partners, Banca March, Goodgrower and Schroder Adveq, according to Unquote Data.

Investments
The fund offers typical equity cheques of €30-60m to companies in the healthcare sector and will hold 9-10 investments. The average holding period for the portfolio companies will be four to six years.

Two investments have already been made from the fund, including UK-based Dental Care Group, and it is more than 15% deployed.

The firm is expected to make another acquisition during Q1 2020; this will bring the fund to 20-25% deployed.

The firm also offers co-investments.

People
G Square Capital – Laurent Ganem (CEO).