MidCap Financial forms to invest in health care industry

By Sara Rosenberg

New York, Nov. 25 - A new commercial finance company called MidCap Financial LLC was created to focus on middle-market lending to the health care industry, according to a news release.

The company will focus on investments in leveraged loans to health care companies backed by private equity sponsors, real estate loans to senior housing, skilled nursing facilities and medical office buildings, working capital loans collateralized by third-party accounts receivable and other assets, and life sciences loans, primarily to pharmaceutical, biotech and medical device companies.

Bethesda, Md.-based MidCap is starting with over $500 million in equity commitments from investors that include Thomas H. Lee's Lee Equity Partners LLC, Genstar Capital LLC and Moelis Capital Partners.

In addition, the company has a substantial long-term debt facility in place that was led by Wells Fargo Foothill.

MidCap is being led by the entire former senior management team of Merrill Lynch Capital Healthcare Finance, including its founder, Howard Widra, who will be chief executive officer.

"Our target markets share common features that make them especially attractive," said Widra in the release.

"Health care continues to be one of the largest and most rapidly growing segments of the economy. The current liquidity crisis has created significant demand for our products and services. We are extremely pleased to be in a position to fill the void in an industry as critical and necessary as health care."

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