10X Return for Edison on Exit 

10X Return for Edison on Exit 

phx nf1Edison Partners has sold Premier Healthcare Exchange (PHX), a provider of healthcare cost management and electronic payments services, to Stratose, a portfolio company of Parthenon Capital Partners. The exit generated more than a 10X return and a 70% IRR for Edison Partners which acquired PHX in 2010.

phx nf11PHX provides cost management and electronic payments services to insurance companies, Taft-Hartley funds, health maintenance organizations and third party administrators. Through its Pay-Plus division, PHX provides both electronic payments and explanation of payments to healthcare providers. PHX is led by Todd Roberti, CEO and Founder. The company was founded in 2001 and is headquartered west of Newark in Bedminster, NJ (www.phx-online.com) (www.ppsonline.com).

Chris Sugden nf1Since Edison’s initial investment in PHX in 2010, revenue grew by 8X and EBITDA grew by 6X. “We are grateful to Todd and the entire PHX management team, whose combined vision and execution created a market leader with incredible growth and an exceptional return for all stakeholders,” said Chris Sugden, Managing Partner of Edison Partners. Mr. Sugden and Lenard Marcus, Partner, led the investment for Edison.

Stratose, acquired by Parthenon in July 2015, is a provider of healthcare cost containment services for medical, dental and workers’ compensation payers, third-party administrators, and self-funded entities. The company is headquartered in Atlanta (www.stratose.com).

As part of this transaction, Stratose has also acquired GlobalCare Inc. (www.globalcare.net), another provider of healthcare cost management services. The complete transaction provides for PHX to merge with Stratose and GlobalCare to create one of the largest healthcare claims cost containment companies in the US. Edison will maintain a minority ownership position in the new company, and Mr. Sugden is joining the board of directors. “This combination creates a formidable market leader in end-to-end healthcare value management, and we’re excited to continue to be a part of it,” he said.

edison partners nf1Edison Partners invests from $8 million to $20 million of growth capital in middle market companies with revenues from $5 million to $20 million that are based in the eastern United States. Edison will consider buyouts, recapitalizations, spinouts and secondary stock purchases. Sectors of interest include financial technology, healthcare IT, enterprise IT, and marketing software. Edison has invested in more than 20 healthcare information technology businesses. Current healthcare IT portfolio companies include ClearPoint Learning, Lincor Solutions and TrialScope.  The firm is based in Princeton, NJ with additional offices in McLean, VA, and Cleveland, OH (www.edisonpartners.com).

© 2016 PEPD • Private Equity’s Leading News Magazine • 2-2-16

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