SVB to acquire healthcare-focused Leerink for $280M

The parent company of Silicon Valley Bank plans to buy a major investment bank focused on healthcare.

Santa Clara, California-based SVB Financial Group said Tuesday that it had entered a deal to acquire Boston-based Leerink Holdings, parent company of Leerink Partners, which focuses on healthcare and life sciences. The deal is for SVB to pay $280 million upfront in cash, while providing a retention pool for employees of $60 million to be paid over five years. Leerink Partners’ leadership will remain in place and run the business “in much the same capacity” as it currently does.

Health IT

Reducing Clinical and Staff Burnout with AI Automation

As technology advances, AI-powered tools will increasingly reduce the administrative burdens on healthcare providers.

By Dr. Michael Blackman, Chief Medical Officer at Greenway Health

SVB’s shares were down 2 percent on the NASDAQ in Wednesday morning trading following the news, which was announced late Tuesday afternoon.

“SVB and Leerink share a focus on providing financing and strategic advice at critical stages in a company’s growth and development,” SVB and Silicon Valley Bank CEO Greg Becker said in a statement. “Together, we will deliver a complete capital markets offering – including debt, convertible debt and equity financing – and advisory services – including mergers and acquisitions – for private and public healthcare and life science companies.”

According to its website, the 35-year-old Silicon Valley Bank’s clients include 50 percent of all venture capital-backed life science companies in the US and 50 percent of venture capital-backed companies that had initial public offerings in 2017.

Leerink Partners was founded by Jeffrey Leerink in 1995, according to its website. Recent transactions by the investment bank in the area of biopharma, tools and diagnostics have included initial public offerings like last month’s $273 million IPO by Guardant Health and a $65 million IPO by Equillium, as well as a $122 million IPO by Principia Biopharma in September. Other deals have included sales at undisclosed amounts of device firms Securus Medical Group and Essential Medical, respectively to Boston Scientific in April and Teleflex in October. It has also played significant roles in the pending $217 million sale of New Century Health to Evolent Health and Genoptix’s $125 million plus shares acquisition of Neo Genomics.