Target Information

Founded in 1988 by the Le Guilcher family, Evolucare Group is a prominent French software publisher specializing in health and medico-social solutions. The company employs approximately 370 staff and operates across 19 countries, serving more than 2,700 clients. Evolucare provides a broad suite of products designed to address the clinical, operational, and financial demands of healthcare institutions, focusing on the entire care pathway for patients, residents, and users.

The firm’s offerings include Electronic Patient Records (EPR), critical care solutions, imaging services management (RIS), and specific software for medico-social environments, such as care for the elderly and disabled. With its continuous expansion in Europe and recent impressive financial performance—achieving revenues of €42.9 million and an adjusted EBITDA of €15.7 million in 2022—Evolucare has solidified its status as a key player in the health tech sector.

Industry Overview in France

The healthcare technology market in France has experienced significant growth driven by the increased adoption of digital solutions among healthcare providers. The demand for innovative software tools such as EPR systems has surged, particularly as hospitals and care facilities seek to enhance operational efficiency and improve patient care services. This trend resonates with broader digital transformation initiatives in the healthcare domain.

Moreover, as European healthcare continues to grapple with challenges such as aging populations and rising costs, the role of software solutions that streamline care pathways, improve data management, and facilitate telemedicine is more critical than ever. The intersection of technology and healthcare is fostering new business models, emphasizing patient-centric care and data-driven decision-making.

French healthcare entities are actively investing in digital tools, reflecting a strategic commitment to long-term sustainability. The government’s initiatives supporting digital health innovation further stimulate growth opportunities in this sector. The competitive landscape also sees a mix of established tech companies and emerging startups, contributing to a dynamic environment for growth and consolidation.

As a result, France’s health software sector is poised for expansion, underscoring the strategic viability of investments in companies like Evolucare that provide cutting-edge solutions tailored to the evolving needs of healthcare providers and stakeholders.

The Rationale Behind the Deal

This memorandum of understanding between Essling Expansion and GPI Group outlines a strategic acquisition that aims to combine their respective strengths in the healthcare tech market. GPI Group, known for its innovative software and technology solutions, seeks to enhance its market position by integrating Evolucare’s comprehensive service offerings. This acquisition aims to leverage synergies that will drive innovative solutions in healthcare delivery.

The valuation of Evolucare, set at over €170 million, represents a solid exit opportunity for Essling Expansion, reflecting the successful execution of its investment strategy over the past four years. The deal is expected to generate a 3.0x multiple and an approximate IRR of 28%, confirming the viability of Essling’s approach in backing high-growth technology companies.

Investor Information

Essling Expansion is a growth-focused fund that strategically invests in small-cap technology and healthcare businesses. With an emphasis on high-growth sectors, the fund aims to support companies in their expansion through both organic and acquisition-driven growth. Since its inception in 2019, Essling Expansion has facilitated numerous external growth transactions within its portfolio, demonstrating its commitment to fostering innovation and leadership within the tech landscape.

GPI Group, listed on Borsa Italiana, has over 30 years of experience in providing advanced software and services targeted at healthcare, social services, and public administration. The firm’s remarkable growth strategy relies on significant investments in research and development, coupled with active mergers and acquisitions, establishing GPI as a pivotal partner in healthcare digital transformation.

View of Dealert

This deal between Essling Expansion and GPI Group concerning Evolucare carries promising potential for both financial and strategic gains. The high growth trajectory seen in Evolucare’s performance affirms the robustness of the company, illustrating its readiness for broader integration within GPI’s ecosystem. As healthcare technology advances, Evolucare’s capabilities will complement GPI’s offerings, enhancing its market competitiveness.

Furthermore, the strategic consolidation of resources and expertise between GPI and Evolucare creates a unique proposition for capturing emerging opportunities within the European healthcare sector. With the growing demand for comprehensive care solutions, this move can significantly advance GPI's positioning as a leading provider of health tech services.

Additionally, this deal marks a successful exit for Essling Expansion, validating its investment strategy and demonstrating the viability of its selected portfolio. The return metrics from this exit are favorable, showcasing the potential for future investments within the healthcare technology sector. Overall, the synergies expected from this partnership signify a strong investment proposition with high potential returns.

View Original Article