Fundraising

Abraaj nears $1bn target for healthcare fund

A final close is understood to be just weeks away on the firm's first sector-focused fund.

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The Abraaj Group is nearing a final close on its $1 billion “Growth Markets Health Fund”, its debut healthcare-focused fund, according to market sources. Abraaj declined to comment on the fundraising. Among the investors in the fund is medical device company Medtronic, which announced its involvement in 2015.

“We believe strongly that the penetration of existing therapies into Emerging Markets represents the single largest opportunity in MedTech over the long-term,” the firm told investors in December 2015.

“Abraaj purchases or builds hub hospitals, surrounded by networks of referring hospitals and clinics. We are strategic partners in this market development effort, with a commitment to improve patient access, healthcare delivery outcomes and efficiency, and product supply within these Abraaj hospital networks.”

Abraaj was founded in 2002 and has become one of the private equity industry’s most influential emerging markets-focused firms with around $10 billion in assets under management investing either on a regional or country-specific basis. The healthcare fund is its first sector-specific fund.

The International Finance Corporation, the World Bank's private investment arm, has made a $150 million commitment to the fund, according to published documents.

The fund will “predominantly invest in South Asia and sub-Saharan Africa”, according to IFC, which described the fund as “a pioneering fund dedicated to healthcare targeting social impact”.

“Through its investments, the Fund will target improvement in access, quality and affordability of healthcare for low-income and middle-income populations in Africa, South Asia, South East Asia and Latin America,” IFC wrote in its assessment of the fund.

In other news, Abraaj this week said it had hired Mark Bourgeois, formerly the president and chief executive officer of placement agent Atlantic Pacific Capital, as global head of investor engagement and chief executive officer of Abraaj North America. Bourgeois will lead the firm's fundraising efforts in the region.