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Capital Royalty raises $805m for second private equity fund

3 May 2013

hospital_health_170sqHealthcare focused private equity firm Capital Royalty has closed its second fund on $805m after two and a half years on the road.

The fund was oversubscribed, which allowed it to top its initial target.

It will focus on companies and institutions with rights to approved and commercialised healthcare products, Capital Royalty’s managing director Mike Weinmann told AltAssets.

Weinmann said, “We found that interest in our fund was high given the attractive returns expected to be generated by our strategy, including current cash yield and strong downside protections built into our investments.

“Many investors also viewed an investment in Fund 2 as a way to increase their exposure to the healthcare industry and as complement to existing healthcare venture capital exposure.”

The firm’s first fund was focused on royalty investments, which the second fund will continue to do.

However, a significant part of the fund will be dedicated to funding small and mid sized healthcare companies to support their product commercialisation efforts and the development of new products and technologies.

The firm said that total investable capital is set to exceed $1bn including debt funding facilities available to the fund. Capital Royalty Partners II is expected invest between $20m and $200m per company.

The new vehicle was backed by LPs such as funds, endowments, institutional investors, funds of funds, family offices, and sovereign wealth funds.

It has already made investments following the first close, which was held in August 2011.

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