York Private Equity has acquired Healthcare Linen Services Group (HLSG), a provider of laundry services and linen products for the healthcare and hospitality industries, from Thompson Street Capital Partners.
HLSG serves its more than 500 Midwest and Central Unites States customers – located in 12 states – through four regional brands: Logan’s Linens (Shelbyville, Kentucky), Logan’s Uniform Rental (Shelbyville, Kentucky), Superior Health Linens (Cudahy, Wisconsin) and Textile Care Services (Rochester, Minnesota).
HLSG, led by CEO Joe LaPorta, is headquartered 60 miles west of Chicago in Campton Hills, Illinois and operates 11 facilities that process more than 185 million pounds of linens annually. Thompson Street acquired HLSG (then Logan’s Linens) in October 2009.
“I am looking forward to our new partnership with York Private Equity, and the growth opportunities they provide through both capital and expertise,” said Mr. LaPorta. “Today’s healthcare customers demand sustainability and scale to support their mission of quality care and geographical expansion. HLSG will leverage this new partnership with York to both solidify our footprint and enter new geographies via strategic acquisitions. We will also continue to invest in automating our existing facilities, accelerating our growth, and furthering our commitment to providing the highest level of quality and service to our customers.”
“HLSG is one of the leading outsourced healthcare linen providers both regionally and nationally,” said Seth Pearson, a managing director at York Private Equity. “Our investment in the company aligns with our goal of backing strong management teams with additional capital to drive value for their customers, enter new markets, and execute on their growth strategy.”
York Private Equity is the middle-market private investing group of York Capital Management. The group invests across numerous sectors making them effectively industry agnostic. Since its launch in 2008, the New York City-based group has completed more than 50 investments with an aggregate transaction value greater than $4 billion.
“We are thrilled to partner with the team at HLSG as we work together to pursue the next chapter of growth for the Company,” said Harish Nataraj a managing director at York Private Equity. “This investment represents an attractive opportunity to create value for all of the company’s stakeholders given York Private Equity’s extensive experience in both the healthcare and facilities services sectors.”
York’s investment in HLSG is its seventh platform investment made by its middle-market private equity fund, York Special Opportunities Fund III LP, which closed in April 2020 with $800 million of committed capital.
St. Louis-based TSCP invests in companies with EBITDA between $5 million and $25 million. Sectors of interest include healthcare and life science services, software and technology services, and business services and engineered products. In July 2018, the firm held a final closing of its fifth fund, Thompson Street Capital Partners V LP, at its hard cap of $1.15 billion.
“We have truly appreciated our collaboration with the entire HLSG team,” said JC Wetzel, a director at Thompson Street. “The company has a well-earned, long-standing history as a premier provider of essential linen management services to the healthcare industry and is well-positioned for continued growth and success.”
The sale of HLSG follows Thompson Street’s sale last month of LTP Home Services Group (DBA Len the Plumber), a residential plumbing and HVAC services platform, to L Catteron.
Twin Brook Capital Partners was the administrative agent on the debt financing used to support York’s acquisition of HLSG. Chicago-based Twin Brook focuses on loans to private equity-owned companies with EBITDA between $3 million and $50 million, with an emphasis on companies with $25 million of EBITDA and below. The firm targets senior financing opportunities up to $200 million, with hold sizes across the platform ranging from $25 million up to $150 million. Twin Brook’s products include opportunistic investments in second lien, mezzanine, and equity co-investments.
Lincoln International and Stephens were the financial advisors to HLSG, and Solomon Partners was the financial advisor to York.
© 2022 Private Equity Professional | April 22, 2022
