Update 23 March 2021

In my previous update I said that it felt like spring. Since then, the weather has turned again, and we have had a cold spell these last few weeks. However, the days are getting longer and hopefully spring (and a vaccinated population)  is just around the corner. In this update we cover:

  • Dutch elections. What are the consequences for the healthcare sector?
  • Process related to Bergman Clinics finalized. What can we expect?
  • Ongoing sales process for Ceban. Another private equity investment in the Dutch healthcare sector?

Election results

Up until last week the Netherlands was governed by a coalition of four liberal-centrist parties (VVD, CDA, D66,CU). Last week there were elections for the 150-seat House of Representatives (Tweede Kamer). The overall results of the election were a move to the right. Traditional leftist parties lost eleven seats while the far-right gained six seats.

The previous coalition gained two seats, but the relative strength of the parties changed. The VVD (conservative liberal party with a focus on enterprise, economic liberalism, and the freedom of the individual) gained two seats and remained the largest party in parliament with 35 seats. The D66 (centrist social liberal party with fairly progressive views) was a big winner and went from 19 to 23 seats. The CDA (Christian democratic party supportive of free enterprise but also critical of the current “market-based” healthcare system) lost two seats while the smallest member of the coalition (ChristenUnie) stayed at five seats.

While the exact composition of the new government is still uncertain the relative strength of the different parties clearly mean that it will lean towards more liberalization of the healthcare sector but will not make major changes to the current system. This is clearly good news for current and future commercial organizations active in the Dutch healthcare market as it means that political risks will remain low and that issues such as allowing dividend-payments may be on the agenda again.

Process related to Bergman Clinics finalized

The process related to a possible sale of Bergman Clinics started in January of last year. The process was stopped due to Covid19, but was restarted later in 2020 after further delays due to Bergman acquiring a portfolio of clinics in Germany.

Last week it was announced that Triton will acquire a 70% stake in Bergman Clinics. The remaining 30% is shared between the Malenstein family (from 60% to 20%) and NPM Capital (from 40% to 10%). According to Bart Malenstein they had also considered a stock-exchange listing or sale of a minority stake but chose for Triton as this will finance further growth in Scandinavia and Germany. With deep pockets it can be expected that Bergman Clinics will continue to grow by acquisitions both in the Dutch and the international market. Who will be the first target?

Ceban to be sold

Ceban is one of the larger commercial compounding companies in the Netherlands. It has a checkered history. It was started in 2004 and was acquired in 2009 (together with Medsen – a chain of pharmacies) by Kempen & Co (a Dutch corporate finance bank) as part of a debt-equity swap. Kempen sold both companies to Bencis (a Dutch private equity company) in 2019.

Last week MergerMarket and the Financieel Dagblad announced that Bencis has put Ceban up for sale and apparently the sales process is advanced. The compounding market is a small but interesting sector of the overall pharmaceutical market. Will the buyer be another PE-company?