Arlington Capital Partners has agreed to sell Ontario Systems to New Mountain Capital.
Ontario Systems is a provider of enterprise software that is used for accounts receivable management in the healthcare, accounts receivable management (ARM), and government sectors. The company’s software platforms include the Artiva family of products, FACS, TCS, RevQ, and Ontario Omni. In the government sector, Ontario Systems’ software portfolio includes FullCourt Enterprise which is used by state and local governments to manage court cases, process online payments, and automate revenue recovery processes.
Ontario Systems’ customers include more than 600 hospitals – including five of the 15 largest hospital networks, eight of the 10 largest ARM companies, and more than 600 federal, state, and municipal governments. Together, the company’s customers handle more than $170 billion in payments annually. Ontario Systems was founded in 1980 and has nearly 500 employees in 28 states with a headquarters in Muncie, IN, and additional offices in Vancouver, WA, and Albuquerque, NM (www.ontariosystems.com).
Under Arlington Capital’s ownership, the company has achieved record revenues and profitability. “Our relationship with Arlington Capital Partners has been outstanding,” said Ron Fauquher, CEO and co-founder of Ontario Systems. “With Arlington’s assistance, we have successfully expanded our healthcare-market footprint, entered government markets, doubled our revenues, and expanded our reach to include more than 1,200 clients. We are proud of our progress and achievement of the goals we had previously set, and we thank Arlington for their support in helping drive our strategic growth initiatives. As we take the next evolutionary step, we look forward to New Mountain Capital’s support and partnership.”
“Arlington’s investment in Ontario Systems continues our track record of successful partnership with founding management teams to drive transformational growth in healthcare software companies,” said Matt Altman, a managing partner at Arlington Capital. “The investments in technology and people that we have made over the course of our investment have further distinguished Ontario as the leader in revenue cycle management enterprise software across the large and growing healthcare, government, and accounts receivable management markets.”
“Ontario exemplifies New Mountain’s longstanding investment thesis of backing best-of-breed solution providers addressing critical pain points in revenue recovery and workflow management,” said Matt Holt, managing director and deputy head of private equity at New Mountain Capital. “We look forward to supporting Ontario’s continued growth by identifying both organic and inorganic initiatives to help the company realize its full potential.”
New Mountain is an industry generalist and seeks to acquire just three or four companies each year, typically in the $100 million to $1 billion enterprise value range, and generally invests $100 million to $500 million per transaction. In September 2017, New Mountain held an oversubscribed final close of its fifth private equity fund, New Mountain Partners V LP. The new fund closed at its hard cap with just over $6.1 billion of capital commitments. The firm was founded in 1999 and is headquartered in New York (www.newmountaincapital.com).
Arlington Capital, the seller of Ontario Systems, was founded in 1999 and has completed over 90 acquisitions since its inception. The Chevy Chase, MD-based firm is currently investing out of Arlington Capital Partners V LP, a $1.7 billion fund which closed in June 2019 (www.arlingtoncap.com).
This transaction is expected to close by the end of August.
© 2019 Private Equity Professional | August 23, 2019