Morgan Stanley Capital Partners acquired a controlling interest in SpendMend with Varagon Capital Partners providing the financial support as administrative agent, lead arranger and bookrunner on a senior secured facility.
SpendMend is a provider of tech-enabled solutions to optimize the cost cycle for the healthcare industry. Morgan Stanley’s recently announced acquisition of SpendMend represents its sixth investment within North Haven Capital Partners VII, a fund that recently closed at $2 billion.
According to Morgan Stanley, it originally identified cost containment as a sub sector within healthcare four years ago. Since then, it has proactively pursued multiple opportunities in this category, including SpendMend. They added that the management team and the broader employee base at SpendMend will retain a meaningful ownership position in the company.
Morgan Stanley said it was partnering with the current management team led by CEO Dan Geelhoed and President Rob Heminger, who will continue to lead the business, as well as Sheridan Capital Partners, who will retain a minority stake in the company.
Varagon is a private credit manager focused on directly originated loans to U.S. middle market companies. Since its founding in 2014, Varagon has invested over $19 billion with more than 225 companies financed backed by private equity sponsors.