Madison Dearborn closes MoneyGram deal; Hildred Capital, HCAP and PSG bet on pharmacy services

MDP takes MoneyGram private.

Good morning dealmakers, thank goodness it’s Friday!

It’s Obey Martin Manayiti here with the Wire.

To cap off the week, I will look at six PE-backed pharmacy service deals targeting growth, all announced this year.

Hildred Capital co-founder Andrew Goldman shared some thoughts on deals in the sector.

Other deals that caught my eye this week include one announced this morning from Growth Catalyst Partners, plus the $1.8 billion take-private buyout of MoneyGram by Madison Dearborn Partners and a pair of supply chain deals from KKR.

Let’s start with this morning’s news.

Accelerating tech modernization
GovExec, which is backed by Growth Catalyst Partners, has acquired The Advanced Technology Academic Research Center, an Ashburn, Virginia-based nonprofit that facilitates collaboration between government, industry and academia in order to accelerate technology modernization initiatives.

GovExec provides sales and marketing intelligence across federal, state, and local and defense sectors.

Moving money around the world
Yesterday, Madison Dearborn Partners, based in Chicago, completed its take-private acquisition of Dallas-based fintech company MoneyGram International for $1.8 billion.

MoneyGram is a global financial technology company that enables consumers and businesses to move and manage money in nearly every country around the world, the company said. And through its set of fintech offerings, MoneyGram provides millions of consumers annually the ability to send money home to family and friends, and buy, sell and hold cryptocurrencies on its application.

Supply chain
Earlier in the week, KKR acquired an industrial park in Phoenix and an industrial warehouse in Atlanta. The acquisitions were made in two separate transactions from two different sellers for an aggregate purchase price of approximately $250 million. The firm believes it will pick opportunities from the on-shoring manufacturing trends that are expected to continue growing in the US.

Integrated services
Technology is infusing pharmacies, as customers demand the same experience they have with other types of retail, like online service and home delivery. To fill the need, pharmacy services have been thriving, and private equity firms have seized on the opportunity.

PE Hub has observed a steady stream of private equity-backed pharmacy investments this year, and this week I rounded up six deals.

New York-based Hildred Capital Management, a healthcare-focused private equity firm, made a strategic investment in AleraCare, a Phoenix-headquartered provider of infusion and specialty pharmacy services.

Andrew Goldman, the firm’s co-founder and managing partner told me more about opportunities that the firm found in this sector.

Why is Hildred Capital Management interested in this deal?
AleraCare has a specialty pharmacy that is integrated with its home and ambulatory infusion service lines. This allows for the business to drive deeper relationships with referring physicians, as the growth and need of therapies for complex conditions continues to rise. We are not typically buyers of stand-alone pharmacies, but rather businesses with specialty pharmacies that have integrated service offerings to drive better outcomes and lower costs with strong opportunity for consolidation.

What opportunities has the firm identified with this deal?
AleraCare’s ambulatory infusion center business has white space opportunity to expand locations and provide higher quality service to patients with complex chronic conditions, while also driving cost down for payors versus a traditional hospital setting. With the growth in high-cost biologics, we see this trend continuing for the foreseeable future and becoming a focal point for payors. We see this opportunity as a parallel to the early days of dialysis, which gets us excited about the market potential.

What is the growth strategy?
AleraCare’s growth strategy is to expand existing home infusion services and ambulatory infusion centers via de novo new builds and M&A within its core geographic markets. By leveraging a growing network of office locations to serve patients in a lower cost setting than a traditional hospital, the company will continue driving deeper relationships with referring providers, payors and patients.

Other pharmacy services deals I covered include:

San Diego-based HCAP Partners invested in Xevant, a Lehi, Utah-based provider of automated data analytics for organizations managing pharmacy benefits.

Xevant’s platform infuses real-time automation and alerts throughout the data analysis process, aiming to accelerate and simplify report building for pharmacy benefits managers, pharmaceutical technical assistants, health plans, brokers and consultants.

“Xevant’s innovative solutions and talented team of experts are changing the way that access, quality and cost issues are approached by healthcare stakeholders,” said Frank Mora, HCAP senior partner, in a statement.

DoseSpot, a portfolio company of PSG, a Boston-based PE firm, in March acquired TreatRx, an e-prescribing platform, from Bravado Health, a West Palm Beach-headquartered digital health company.

DoseSpot is based in Dedham, Massachusetts. The company is a provider of software for clinicians to write and transmit prescriptions for pharmacies electronically.

See the whole story for more deals.

That’s all from me.

Have a nice weekend, and MK will be back with you on Monday.