Birmingham, Ala.-based Atherotech, a developer of a novel cholesterol test that was spun out of the University of Alabama, has been acquired by the New York-based investment firm Behrman Capital. Terms of the deal weren’t disclosed.
Behrman Capital, a private equity investment firm based in New York and San Francisco, today announced that it has acquired Atherotech, a Birmingham, Alabama-based provider of cardiometabolic testing services that offers the VAP (Vertical Auto Profile) advanced lipid profile test. The transaction closed on December 23, 2010. The equity capital for the acquisition came from Behrman Capital IV L.P., with debt financing provided by MidCap Financial.
Developed by Jere Segrest, M.D., director of the Atherosclerosis Research Unit at the University of Alabama, Birmingham, Atherotech’s patented VAP Test provides direct, detailed measurements of the lipid subclasses that cause cardiovascular disease. VAP technology more accurately identifies people at risk of heart disease than the traditional cholesterol tests developed in the 1970s, and does so at no significant additional cost. The profiles obtained by the test also allow physicians to create individualized treatment plans while continuing to track patients’ progress in battling heart disease. Atherotech provides its unique testing services to physicians, hospitals, clinics, and other laboratories throughout the United States.
“In light of our previous successes deploying investment capital to help fuel the growth of diagnostic laboratory testing companies, we are particularly excited about this transaction,” said Grant G. Behrman, Managing Partner of Behrman Capital. “Atherotech’s VAP Test is the premium offering in advanced cholesterol testing and has been steadily gaining higher adoption amongst physicians. It enables physicians to more accurately identify those at risk of heart disease – the No. 1 cause of death in the United States – and more effectively treat those suffering from it. We look forward to partnering with CEO Mike Mullen and the rest of the Atherotech management team as they continue to pursue the growth of their business.”
“We are excited to partner with Behrman Capital and leverage their prior experience and expertise to continue executing upon our growth strategy,” said Michael Mullen, CEO of Atherotech. “Our value proposition lies in the ability to provide early detection of heart disease risk, significantly reducing downstream healthcare costs and improving quality of life. We believe there are tremendous opportunities for the continued growth of our business due to the increasing awareness of cardiovascular disease risk in the United States.”
Robert Flaherty, an Operating Partner at Behrman Capital, will serve as Chairman of the Board of Directors at Atherotech. Mr. Flaherty has more than 35 years of operating experience in the healthcare field, with particular expertise in the clinical laboratory environment. He previously served as President and CEO of Athena Diagnostics, Inc., a Behrman Capital portfolio company that was sold to Fisher Scientific in 2006. During his 17 year tenure with the company, he grew Athena’s revenues from $3 million to $110 million and profits from zero to $50 million.
Other successful investments by Behrman in the laboratory testing space include Esoterix, Inc. and WIL Research Laboratories, Inc.
Goodwin Procter LLP acted as legal adviser to Behrman Capital for the transaction. Bradley Arant Boult Cummings LLP acted as legal adviser to Atherotech. Morgan Keegan & Company, Inc.’s Shattuck Hammond healthcare investment banking division acted as financial advisor to Atherotech.
Based in New York City and San Francisco, Behrman Capital was founded in 1991 by Grant G. and Darryl G. Behrman. The firm invests in management buyouts, leveraged buildups and recapitalizations of established growth businesses. The company’s investments are primarily focused in five industries: health care, specialty manufacturing, outsourcing, defense and information technology. The firm currently has a combined capital base in excess of $2.0 billion. For more information, please visit www.behrmancap.com.
MidCap Financial is a commercial finance firm that focuses exclusively on providing debt solutions to middle market healthcare companies. The company is headquartered in Bethesda, MD, with offices in Chicago and Los Angeles. MidCap Financial focuses on investments in four areas: Leveraged Loans to healthcare companies backed by private equity sponsors; Working Capital loans collateralized by third-party accounts receivable and other assets; Life Sciences loans, primarily to pharmaceutical, biotech, and medical device companies; and Real Estate loans to senior housing, skilled nursing facilities, and medical office buildings. Additional information about MidCap Financial can be found at www.midcapfinancial.com.