Healthcare

Satori Capital Invests in Longhorn Health Solutions

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Satori Capital has invested in Longhorn Health Solutions, a direct-to-home provider of consumable medical supplies.

Longhorn Health Solutions is a direct-to-home provider of consumable medical supplies, durable medical equipment, and pharmaceutical prescriptions serving the Medicaid, Medicare, and privately insured populations across Texas. The company has 150 employees and ten branch locations in Austin, Beaumont, Corpus Christi, El Paso, Fort Worth, Harlingen, Houston, Lubbock, San Antonio, and Waco. Longhorn Health Solutions is headquartered in Austin
(www.longhornhealth.com) and (www.lhsrx.com).

“Longhorn is intently focused on reducing total cost-of-care for managed care organizations by streamlining billing processes, improving patient utilization and compliance, enhancing product quality, and heightening transparency throughout the patient, provider, and payor ecosystem,” said Sunny Vanderbeck, Managing Partner at Satori. “We believe in the team’s service-based approach, and look forward to partnering with them to further serve the growing needs of their stakeholders.”

Britt Peterson, founder and CEO of Longhorn, will continue to lead the company. “Longhorn has earned a reputation for excellence through its reliable performance, dedicated customer service, statewide presence, and commitment to integrity and kindness across everything that we do,” said Mr. Peterson. “Our partnership with Satori provides access to a deeper network of healthcare expertise, a valuable collection of operational best practices, and ample resources for both organic expansion and growth via acquisition. Collectively, these resources strengthen Longhorn’s ability to provide higher quality products and services that improve patient outcomes, while also providing manufacturers with cost-effective access to a highly fragmented home health patient base.”

The Brookside Group provided debt financing for the transaction and Allegiance Capital Corporation acted as the exclusive financial advisor to Longhorn.

Satori Capital invests in companies that have revenue of $25 million to $200 million and free cash flow of $3 million to $15 million. Sectors of interest include business services; consumer products; e-commerce; financial services; manufacturing; and mature software/IT/telecom. The firm is based in Dallas (www.satoricapital.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 2-21-13

H.I.G. Growth Acquires Family Behavioral Resources

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Community Intervention Services (CIS), an operator of mental health and substance abuse treatment programs and a portfolio company of H.I.G. Growth Partners, has acquired Family Behavioral Resources, a provider of rehabilitation services to children and adolescents.

Family Behavioral Resources (FBR) specializes in providing behavioral health rehabilitation services to children and adolescents, with a particular focus on serving individuals on the autism spectrum. FBR provides services through a network of 27 locations across western and southern Pennsylvania and employs a clinical staff of over 1,200 clinical therapists, qualified behavioral health professionals and developmental educators. The company was founded in 1999 and is headquartered in Greensburg, PA (www.familybehavioralresources.com).

“I couldn’t be more excited about the partnership with both CIS and H.I.G.,” said Rick Murray, President & COO at FBR. “We now have access to the capital and the operational support that will enable us to accelerate our growth, and more importantly, support more consumers and families. Further, the standards of excellence and vision for changing lives that exist at CIS align perfectly with the mission and values that FBR was founded upon.”

Community Intervention Services was formed by H.I.G. in partnership with behavioral healthcare executive Kevin Sheehan to acquire, develop and operate a national network of community-based mental health and substance abuse treatment programs. Mr. Sheehan is the founder and former Chairman, President and CEO of Youth & Family Centered Services, a national provider of behavioral health services to infants, children and adolescents.

Family Behavioral Resources is CIS’s third acquisition and provides the company with a regional presence in the Mid-Atlantic and an entry into the Midwest. “FBR represents an ideal acquisition for CIS. Rick and his team have built a strong company, and their deep experience in providing autism services will provide CIS with an important clinical tool as we expand the platform and strive to meet a vastly unmet need for community-based services. We are hopeful that we will continue to find more acquisitions like FBR to further accelerate our expansion into new regions,” said Mr. Sheehan.

H.I.G. Growth Partners is the dedicated growth capital investment affiliate of H.I.G. Capital. With $500 million of committed capital, H.I.G. Growth Partners seeks to make both majority and minority equity investments ranging from $5 million to $30 million in growth-oriented businesses with between $10 million and $100 million in revenues. H.I.G. Growth Partners considers investments across all industries, but focuses on certain high-growth sectors where the team has in-house expertise such as healthcare, technology, internet and media, consumer products and technology-enabled financial and business services (www.higgrowth.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 2-20-13

Linden Capital Partners Exits Urinalysis Business

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HYCOR Biomedical, a manufacturer and marketer of in vitro diagnostic products and a portfolio company of Linden Capital Partners, has sold its urinalysis business to an affiliate of One Rock Capital Partners, Laurel Crown Partners, and StoneCreek Capital. The sale includes the KOVA® system of urinalysis products.

The acquired urinalysis business will be named Kova International and will continue to operate out of its Garden Grove, CA manufacturing facility. The transaction includes the transfer of urinalysis assets and employees. Kova International will be led by Vance Mitchell, who has more than 25 years of experience with the Kova urinalysis business (no website is available yet for Kova International).

HYCOR Biomedical is a manufacturer and marketer of in vitro diagnostics products. Since its founding, HYCOR has expanded its presence in allergy and autoimmune products used in clinical laboratories, hospitals and doctors’ offices worldwide. Brand names include HYTEC™ and AUTOSTAT™. HYCOR was founded in 1981 and is based in Garden Grove, CA (www.hycorbiomedical.com).

One Rock makes equity investments of $10 million to $50 million in companies operating in the chemicals, industrial and consumer durables, business services, environmental services, healthcare products, and automotive retail sectors. The firm is based in New York (www.onerockcapital.com).

Laurel Crown Partners invests from $10 million to $50 million in companies having enterprise values between $50 million and $350 million and an EBITDAs between $5 million and $30 million. Sectors of interest include consumer products and services, retail, healthcare products and services, restaurants, leisure, media, general industrial, financial services, logistics, and aerospace & defense. Laurel Crown Partners was founded in 2001 and is based in Los Angeles (no website found).

StoneCreek Capital invests in middle market companies that have EBITDAs of at least $2 million. The firm is industry agnostic but has a particular interest in the manufacturing, consumer products, food service and business service sectors. The firm is based in Irvine, CA (www.stonecreekcapital.com).

Linden Capital Partners is focused exclusively on leveraged buyouts in the healthcare and life science industries. Linden’s strategy is based upon four elements: specialization on middle market healthcare and life science companies; integrated private equity and operating expertise; customized value creation programs for each portfolio company; and strategic relationships with large corporations. The firm is based in Chicago (www.lindenllc.com).

Houlihan Lokey served as exclusive financial advisor to HYCOR and Kirkland & Ellis provided legal advice to HYCOR for the transaction.

© 2013 PEPD • Private Equity’s Leading News Magazine • 2-19-13

Clayton, Dubilier & Rice and GS Capital Exit AssuraMed

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Cardinal Health today announced plans to acquire AssuraMed, a provider of direct-to-home medical supplies and a portfolio company of Clayton, Dubilier & Rice and GS Capital Partners, for $2.1 billion.  The transaction is expected to close by early April 2013.

Cardinal Health has obtained a commitment letter from BofA Merrill Lynch for a new $1.3 billion senior unsecured bridge term loan in connection with the planned acquisition.

AssuraMed, previously known as HGI Holding, is a mail-order, direct-to-consumer provider of disposable medical products to chronic disease patients. AssuraMed operates through its Edgepark Medical Supplies and Independence Medical divisions, offering its large and fragmented customer base more than 30,000 products addressing a diverse set of chronic disease market segments including ostomy, diabetes, urological, enteral, incontinence and wound care.  AssuraMed has annual sales of approximately $1 billion.  The company operates 12 distribution centers and is based in Twinsburg, OH (www.assuramed.com).

“AssuraMed is a natural extension of the Cardinal Health businesses and of our mission to be essential to care. The acquisition of this industry leader allows us to serve the growing number of Americans treated in home settings – particularly those patients recovering from acute episodes and those suffering with chronic diseases. This is a platform opportunity for Cardinal Health products and services which will be increasingly important as the delivery of care migrates to more cost-effective settings,” said George Barrett, chairman and chief executive officer of Cardinal Health.

Cardinal Health is a $108 billion health care services company that improves the cost-effectiveness of health care. Cardinal Health helps pharmacies, hospitals, ambulatory surgery centers and physician offices focus on patient care while reducing costs, enhancing efficiency and improving quality. Cardinal Health is also a manufacturer of medical and surgical products, including gloves, surgical apparel and fluid management products. The company supports the diagnostic industry by supplying medical products to clinical laboratories and operating the nation’s largest network of radiopharmacies that dispense products to aid in the early diagnosis and treatment of disease. The company is based in Dublin, OH (www.cardinalhealth.com).

Cardinal Health was advised by BofA Merrill Lynch and Wachtell Lipton Rosen and Katz. Clayton, Dubilier, & Rice and GS Capital Partners were advised by J.P. Morgan, Goldman, Sachs & Co., and Debevoise & Plimpton.

© 2013 PEPD • Private Equity’s Leading News Magazine • 2-14-13

RLH Equity Partners Acquires The Chartis Group

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Riordan, Lewis & Haden Equity Partners (RLH) has made an investment in The Chartis Group, a strategy consulting firm serving hospitals and other healthcare organizations.  RLH partnered with the existing Chartis’ management team, led by founding partners Ken Graboys, Ethan Arnold, and Chris Regan, on this transaction.

The Chartis Group is an advisory services firm that provides management consulting and applied research to healthcare organizations. The firm assists its clients with strategic decisions on economic matters such as developing or participating in an accountable care organization, acquisitions of physician groups, geographic expansion of the care delivery footprint, and achieving efficient care delivery processes at each site.  Chartis’ roster of clients includes over 60 nationally renowned academic medical centers, 9 of the top 10 children’s hospitals in the US,  81% of US News honor roll hospitals, and 20 of the top 25 cancer centers nationwide. The Chartis Group has offices in New York, Boston, Chicago and San Francisco (www.chartisgroup.com).

“Chartis brings great expertise to help its provider clients make key decisions in the context of game-changing recent legislation and intensive industry regulation.  Demand for the company’s experienced insights is growing rapidly as large healthcare systems address the increasing complexity and rapid pace of change in the US healthcare system.  The company has the strong cohesive leadership, high organic growth rate, critical mass of revenue, outstanding reputation, and exciting market opportunity that make it an excellent fit with RLH’s investment focus,” said J. Christopher Lewis, Managing Director of RLH.

Riordan, Lewis & Haden invests in high growth, lower middle market companies that have revenues from $20 million to $150 million.  Sectors of interest include business services, healthcare, and government services. The firm currently manages over $500 million of assets and is actively seeking new portfolio companies. Riordan, Lewis & Haden is based in Los Angeles (www.rlhequity.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 2-6-13

JLL Partners to Acquire BioClinica and CoreLab Partners

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BioClinica, a provider of clinical trial management services, has entered into an agreement to be acquired by JLL Partners.  Simultaneously, JLL Partners has also reached an agreement to acquire CoreLab Partners, a provider of medical imaging services.  The proposed acquisition of CoreLab Partners is contingent on the closing of the BioClinica transaction. Both acquisitions are expected to close concurrently.

Following the proposed acquisitions, BioClinica and CoreLab Partners will be merged to create a single provider of medical imaging services and eClinical solutions for clinical trials.  Ampersand Capital Partners, which is the majority owner of CoreLab Partners, will also be a significant investor in the combined company.  Mark Weinstein, currently President and CEO of BioClinica, will lead the combined company.

“We are excited about the tremendous promise of this business combination given the strong fundamentals of each company and the overall industry. We will conservatively capitalize the combined business and look forward to supporting its continued growth,” said Dan Agroskin, Managing Director of JLL Partners. 

CoreLab Partners’ services include medical image management, interpretation, and response assessment for clinical trials, with a particular focus on the oncology therapeutic area. CoreLab Partners provides regulatory support and digital image submission, as well as cardiac safety assessments for development programs, support for clinical studies, and equipment rental. The company also offers worldwide ambulatory blood pressure monitoring services, digital ECG services, and cardiac safety services. CoreLab Partners is based in Princeton, NJ (www.corelabpartners.com).

BioClinica is a provider of integrated, technology-enhanced clinical trial management solutions. BioClinica supports pharmaceutical and medical device innovation with imaging core lab, internet image transport, electronic data capture, interactive voice and web response, clinical trial management, and clinical supply chain forecasting and optimization solutions.  The company operates state-of-the-art, regulatory body-compliant imaging core labs on two continents, and supports worldwide eClinical and data management services from offices in the United States, Europe and Asia. The company is based in Newtown, PA (www.bioclinica.com).

JLL Partners invests in manufacturing and service industries with a particular interest in healthcare services, financial services and business services.  The firm has approximately $4 billion of capital under management and is based in New York (www.jllpartners.com).

Ampersand Capital Partners is a private equity firm that focuses on middle market growth equity investments in the healthcare sector. The firm is based in Boston (www.ampersandcapital.com). 

© 2013 PEPD • Private Equity’s Leading News Magazine • 1-30-13