Nordic Capital’s interest in corpuls, a medical technology company that provides emergency medical services and cardiac resuscitation, was based on the firm’s long track record in the sector and opportunities brought on by fast-moving innovation, partner Jonas Agnblad told PE Hub Europe.
Based in Kaufering in Germany, corpuls develops a range of medical products, including advanced life support defibrillators and monitoring devices, automated external defibrillators and chest compression devices. The company reported revenues of €127 million in 2022 and employs 450 people. Nordic Capital will make the investment in partnership with the founding family.
“Medtech is an interesting area to invest in,” said Agnblad. “There’s room for outsized growth driven by the high general pace of innovation.”
This innovation has an ability to significantly improve the quality of lives for patients, according to Agnblad, and “ultimately also generates savings for the payers”.
Technology that reduces the need for patients to attend clinics, such as remote monitoring or superior diagnostic tools, are some key focus areas that Nordic Capital has identified. “These allow for earlier diagnosis and treatment, increasing the chances of survival for the patient,” Agnblad added.
Nordic Capital isn’t alone in its interest in the sector. According to a Bain & Co report, medtech deals did “return to earth” in 2022, following a record breaking 2021. By the end of 2022, however, medical technology deal activity bounced back. During the year, nine of the 10 largest deals went to device original equipment manufacturers (OEMs). Nordic Capital’s $300 million investment for a 25 percent stake in Israel-based Equashield, a provider of closed system transfer devices, was one of these.
PE Hub Europe has written a round-up of some of the medtech deals so far this year.
But medtech isn’t an easy sector to navigate. While Agnblad described the European regulatory environment as generally “harmonised”, there are other obstacles to tackle. “You also have a reimbursement environment that is individual to each country,” he said. “That adds extra complexity.”
Organic expansion
As Nordic Capital is a growth focused investor in healthcare, corpuls fitted “perfectly” with the Stockholm-headquartered firm’s investment strategy. For corpuls, the growth aims will focus on international expansion. “The main plan for us is to continue on that organic growth journey,” said Agnblad “The company was founded in Germany, but the majority of the sales today are actually generated outside Germany.”
The company has made a “meaningful” expansion into other countries, such as France, UK and Australia, but Germany will remain as the “stronghold” for the company, Agnblad added.
Supporting corpuls’ innovation is also high on Nordic Capital’s to-do list, as it has been “an absolute key” to the company’s success.
An opportunity to look at acquisitions exists, but Nordic Capital will evaluate these together with corpuls’ management team.
Growing a healthcare company organically is not a step into the unknown for Nordic Capital. The firm, alongside Five Arrows, exited The Binding Site to Thermo Fisher Scientific in a deal valued at £2.25 billion ($2.6 billion; €2.6 billion) at the end of October. The exit yielded 19x Nordic Capital’s initial investment in The Binding Site, according to sources close to the matter, who added that it made it the firm’s best investment to date.
Growth for The Binding Site was “not driven by M&A in any way, shape or form”, Agnblad told PE Hub Europe at the time.
Nordic Capital’s experience with family-owned companies was paramount in the discussions with corpuls. “That, combined with our experience in the healthcare sector, was critical with them deciding to partner with Nordic Capital on this journey.”
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