Monroe provides debt for Linden’s ProPharma acquisition

The investment is a senior debt facility in ProPharma, a US-based medical service company, which operates both in Europe and the US.

Monroe Capital has provided senior credit facility funding as the sole, lead arranger to Linden Capital Partners for the latter’s acquisition of ProPharma Group, PDI sister title Private Healthcare Investor has reported.

ProPharma, which was founded in 2001 and is based in Kansas, is an outsourced medical services company providing drug safety monitoring and regulatory compliance consulting in the pharmaceutical, biotechnology and medical device sectors.

Although terms of the financing were not disclosed, the funding came from several of Chicago-based Monroe’s vehicles, according to the firm’s managing director, Matt Evans.

He added ProPharma was an attractive investment because Monroe was able to take advantage of the trend to outsource services in the pharmaceutical space. He attributed this trend to the increased difficulty of creating large, blockbuster drugs from scratch, resulting in a “less healthy pipeline” of products that would drive revenue. In turn, these companies are scaling back their in-house functions, such as running clinical trials, he said.

Another reason Monroe found ProPharma a good opportunity is that the company has a global footprint in the US and Europe, the two regions providing opportunities for outsourcing in the mid-market, according to Evans.

He added that this is Monroe’s first lead agent role with Chicago-based Linden, but the firms have worked together on debt funding in the past.

Monroe is a mid-market private debt firm that provides senior and junior debt, and equity co-investments in the US and Canada.

Linden, founded in 2002, is a private equity firm specialising in buyouts in healthcare and life sciences. Its third flagship vehicle, Linden Capital Partners III, held a final close in March 2015 on $750 million, above its $600 million target, according to PEI data. Investors in that fund include AlpInvest Partners and El Paso Firemen & Policemen’s Pension Fund.