Febrero 8, 2009
Advent-Morro announces $8 Million Distribution

San Juan based private equity firm Advent-Morro Equity Partners announced its eight distribution since the inception to the Investors of the Guayacán Private Equity Fund (“GPEF” or the “Fund”).  This distribution, amounting to $8,000,000, is equivalent to 20.53% of the Fund’s contributed capital, bringing the total cumulative distributions to investors up to $39,188,974.  This represents 100.56% of contributed capital since the Fund’s inception. 

The proceeds being distributed are exclusively related to the Fund’s investment in Medical Card Systems (“MCS”), which in December 2008 made certain distributions to its shareholders, including the Fund, and from proceeds released from an escrow account that was established when a controlling interest of MCS was sold to New York based JLL Partners in December 2004.

Advent-Morro’s history with MCS dates back to March 1998, when Advent-Morro teamed up with the management team of MCS, Felipe Benedit, Jose Durán and Guillermo Meléndez, to form a “Criollo Management Buyout” to purchase MCS from U.S. based MedPartners, Inc.   The management buyout of MCS was financed with $6,200,000 in equity, of which Advent-Morro participated with $4,000,000 through several of its funds.  The balance was provided by over 14 of MCS’ management and employees.

MCS has experienced extraordinary growth since Advent-Morro invested.  Ten years ago, MCS was a small Third Party Administrator (TPA) of health insurance claims with less than $24,000,000 in premiums.  Today, MCS is the 2nd largest health insurance company in Puerto Rico, providing healthcare coverage to over 600,000 people and generating over $1,300,000,000 in revenues.

“Focusing on building successful local companies by helping the management teams with capital and seasoned advice to execute on their business plans has been a financially rewarding experience” said Cyril Meduña, Advent-Morro’s President.   “We will continue to focus on our Puerto Rico based strategy, keenly seeking unique opportunities to build leading companies in their respective sectors”.

The Fund has experienced multiple liquidity events from its investment in MCS.  In total, it has received cash distributions of $22,118,100, representing cash-on-cash return of 6.49 times the $3,403,622 invested, and providing the Fund with an annual rate of return  of 24.2% over the 10-year period that the Fund has held its investment in MCS.   In addition, the Fund continues to hold a significant equity interest in MCS equal to 16.4%, which summed to Advent-Morro’s other interest, represents 21.12%  of MCS’s outstanding shares.

Advent-Morro Equity Partners, led by its founder Cyril Meduña, has been managing private equity investments funds in Puerto Rico since 1989, and is Puerto Rico’s leading venture capital investment firm with 37 investments made since its inception and more than $120 million under management.  Since 1997, Advent-Morro has been affiliated with Advent-International.