The uncertainty hanging over Wall Street these days hasn't stopped investors from forming a new commercial finance firm focused on healthcare.
MidCap Financial, based in Bethesda, Md., announced its formation in November with more than $500 million in equity commitments, the backing of a billionaire private equity investor and a management team composed of the former senior managers of Merrill Lynch Capital Healthcare Finance. The company also has offices in Los Angeles and Chicago.
"Demand for healthcare services is expected to increase markedly as the Baby Boomer generation ages, creating higher demand for the full range of healthcare services," said Howard Widra, the founder of Merrill Lynch's healthcare finance division and former president of GE Healthcare Financial Services who will serve as the new company's CEO. "MidCap opens its doors with substantial capital available to lend into this growing market. Given the limited availability of credit in the middle market generally and in the healthcare industry specifically, we believe we offer a valuable new opportunity for growing and successful healthcare companies to expand their businesses through custom-tailored solutions."
Focused on small and midsized health enterprises, MidCap will invest in four areas:real estate loans to senior housing, skilled nursing facilities and medical office buildings; working capital loans collateralized by third-party accounts receivable and their assets; leveraged loans to healthcare companies backed by private equity sponsors; and life sciences loans, primarily to pharmaceutical, biotech and medical device companies.