Banc One Capital Corp. has teamed up with Cain Brothers, a New York- based investment bank specializing in the health-care industry.
The section 20 subsidiary of Banc One Corp., Columbus, has been on the prowl for such partnerships since March, when it received equity powers from the Federal Reserve.
Along with taking a minority stake in Cain Brothers, Banc One Capital will invest up to $25 million in its venture capital fund, CB Health Ventures. The alliance will give Banc One Capital an edge in the heath-care market.
'Cain Brothers has "a great client base," said James Hensen, executive vice president and general counsel at Banc One Capital. "When it comes to critical-care facilities, they have the reputation of being one of the best in the industry."
Teaming up with a specialty player is how the bank wants to add expertise, David Meuse told American Banker in March. Mr. Meuse is the unit's chairman and chief executive officer.
Alliances such the Cain Brothers partnership are a means to more business. "Each of these companies has clients that we can do merchant banking with," said Mr. Hensen.
Cain Brothers' client base includes hospitals, physician group practices, managed-care companies, long-term-care facilities, and diagnostic centers.
James Cain, a founding principal at Cain Brothers, said that the firm hopes to raise $100 million for the venture capital fund. A first closing for the fund is expected in late fall, when the firm can begin to make investments from the capital raised.
The fund will invest in health-care companies. The investment style of the fund, including average size of investments, is yet to be determined, according to Mr. Cain.
Terms of the fund, such as management fee and return split between limited and general partners, were not disclosed.
Since receiving equity powers, Banc One Capital has also acquired Delphis International, a small import-export finance firm in Washington.
