SV Life Sciences flush with venture cash, bullish on exit deals

Boston-based SV Life Sciences, an active investor in the biotech scene, is flush with cash and its partners are practically bubbling with excitement over the improved prospects for cashing out of deals at a premium.

SV garnered $523 million for its fifth life sciences fund, about $123 million over its target. And Managing Partner and Chief Executive James Garvey says that after a long dry spell, he's seeing a real shift in buyout strategies as acquirers start paying more for quality rather than a discount for financial distress.

"[Strategic acquirers] started to peek out of the woodwork in March of 2009," Garvey told the Wall Street Journal. "It was like Groundhog Day. Now I think we're back to a better than normal environment where the acquirers aren't just looking for bargains. They're looking for value."

But the exit deals are changing as well, he adds. Acquirers are paying more, but they're putting up less upfront, with more at the back end as developers' products start to deliver. "You might get to a $700 million deal, instead of $500 million, but up front you get $300 million."

SV now has about $2 billion under its management. And it's been very active in Europe as well as the U.S., with funds invested in a wide variety of healthcare companies.

- check out the SV release
- here's the story from the Wall Street Journal

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