Carlyle Buys Qualicorp from General Atlantic, Others


The Carlyle Group has agreed to acquire Qualicorp, a Brazilian health insurance plan administrator. No financial terms were disclosed. Sellers include private equity firm General Atlantic, which bought a minority stake back in 2008.

PRESS RELEASE

The Carlyle Group (Carlyle) – a global alternative asset manager with about $90 billion of assets under management – and the shareholders of Grupo Qualicorp (Qualicorp) – market leader in brokerage, consultancy services and management of private health insurance plans in Brazil – announced today that Carlyle will acquire a controlling stake in Qualicorp. As part of the transaction, minority shareholder General Atlantic, LLC, will sell one hundred percent of its shares in Qualicorp to Carlyle and exit the investment. Financial terms were not disclosed. The transaction is expected to close in August subject to Brazilian regulatory approval.

“Carlyle’s global footprint, financial strength and track record in the management of healthcare companies are great assets to Qualicorp,” said Heráclito Brito, Qualicorp CEO, who will remain in command of operations. “This new partnership will help Qualicorp move to the next level of efficiency in providing high-quality services and increase our ability to make acquisitions. Up to this point our growth has been primarily organic,” he added.

Upon completion of the transaction, Qualicorp will be well positioned to continue its strategy of enabling Brazil’s middle class to access high-quality private health insurance. In addition, as a result of the growth of the Brazilian economy and the increase in disposable income in the country, Qualicorp will be able to diversify its market presence, developing products, services and solutions for lower income segments that look promising for the coming years.

“As the middle class grows they demand services and products that were previously beyond their reach. Qualicorp is helping to meet a critical need: reasonably priced, quality health care,” said Fernando Borges, Managing Director who heads Carlyle’s South American investment team and worked with Carlyle’s U.S.-based healthcare sector team on the investment.

Carlyle Managing Director Stephen Wise said, “We are pleased to partner with the Qualicorp management team as we build upon the company’s excellent growth and service track record. Brazil’s stability, growth and credibility in the global economy make it a particularly attractive place to invest now. Qualicorp sits at the nexus of the growing middle class and consumer desire for high-quality, low-cost healthcare. Qualicorp is an important part of the cost containment, quality service solution.”

Jonathan Korngold, a Managing Director of General Atlantic and head of the firm’s healthcare sector, said, “We have the highest regard for Qualicorp’s management team and we are proud to have helped to create value and deliver strong results for the company. We will continue to be active investors in Brazil as it is an attractive market for us.”

Funds for the transaction will come from Carlyle Partners V, a $13.7 billion buyout fund, and Carlyle South America Buyout Fund.

Carlyle’s financial advisor is Banco Bradesco BBI S.A., and Latham & Watkins and Barbosa, Müssnich & Aragão are Carlyle’s legal advisors. Qualicorp was advised by bank Credit Suisse, BR Partners and law firms Davis Polk & Wardwell and Mattos Filho, Veiga Filho, Marrey Jr e Quiroga Advogados.

About Grupo Qualicorp

Grupo Qualicorp (Qualicorp) is the leader in health benefits management services in Brazil. Founded in 1997, Qualicorp has about 1,200 employees and represents about 2.8 million beneficiaries as of June 2010. Aiming at creating and making perpetual people’s access to high-quality, low-cost healthcare, Qualicorp is active in three market segments: i) enabling group health insurance plans (adhesion contracts) for professional categories, by establishing partnerships with professional associations; ii) providing consultancy services and management of corporate benefits; iii) supplying administrative services for self-insurers and operators (also known as TPA – Third Party Administration.) For more information, please visit www.qualicorp.com.br.

About The Carlyle Group

The Carlyle Group is a global alternative asset manager with $90 billion of assets under management committed to 67 funds as of March 31, 2010. Carlyle invests across three asset classes – private equity, real estate and credit alternatives – in Africa, Asia, Australia, Europe, North America and South America focusing on aerospace & defense, automotive & transportation, consumer & retail, energy & power, financial services, healthcare, industrial, infrastructure, technology & business services and telecommunications & media. Since 1987, the firm has invested $60.6 billion of equity in 969 transactions. The Carlyle Group employs more than 880 people in 19 countries. In the aggregate, Carlyle portfolio companies have more than $84 billion in revenue and employ more than 398,000 people around the world. www.carlyle.com

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