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Main Street Inks 31% IRR on Sale of NCP

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NCP nf1Main Street Capital has fully exited its investment in NCP Investment Holdings (National Cardiovascular Partners), a healthcare services company, with the closing of the sale of the company to Fresenius Medical Care.

National Cardiovascular Partners (NCP) is an operator of free-standing outpatient cardiac and vascular procedure labs. The centers are joint venture partnerships between NCP and a group of physicians and hospitals that perform diagnostic and therapeutic procedures at the site. The company is based in Houston (www.ncplp.com).

Main Street made its initial investment in NCP in 2004 to support growth initiatives, with Main Street’s investment consisting of a first lien, secured debt investment with an equity warrant participation. Main Street’s debt investment in NCP was fully repaid during the second quarter of 2012, and a majority of its equity interest in NCP was purchased by Bain Venture Partners in the fourth quarter of 2012.

With the close of the sale of NCP to Fresenius Medical Care (www.fmcna.com), Main Street realized a gain of approximately $8.6 million.  On a cumulative basis since Main Street made its initial investment in NCP in 2004, Main Street realized an internal rate of return of 30.9% and received 4.7 times its money invested.

Main Street Capital provides long-term debt and equity capital to middle market and lower middle market companies in diverse industry sectors that generally have annual revenues ranging from $10 million to $150 million. Main Street provides “one stop” financing alternatives within its lower middle market portfolio. The firm is based in Houston, TX (www.mainstcapital.com).

2014 PEPD • Private Equity’s Leading News Magazine • 10-28-14

Gryphon Investors Acquires C. B. Fleet

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fleet labs nf1San Francisco-based middle market private equity firm Gryphon Investors has acquired a majority equity interest in C. B. Fleet Company (DBA Fleet Laboratories).  Fleet’s management team, along with several additional investors, will hold minority stakes alongside Gryphon.

Upon closing of the transaction, Steve LaMonte, a Gryphon advisor and a senior executive with experience in both over-the-counter and personal healthcare businesses, assumed the position of Chairman of the Board of Fleet.  Mr. LaMonte’s past experience includes leadership positions at Johnson & Johnson, Pfizer, and Schering-Plough.  Fleet’s current CEO Jeff Rowan and the rest of the senior management team will remain with the company post closing.

Fleet Laboratories is a consumer healthcare manufacturer and marketer of personal care and over-the-counter products in the feminine hygiene, gastrointestinal, and infant care categories. The company’s product lines include Summer’s Eve feminine hygiene products, the Fleet disposable enema, Norforms feminine deodorant suppositories, Pedia-Lax laxatives for children, Phazyme anti-gas medication, and the Boudreaux’s brand of baby products. Fleet Laboratories was founded in 1869 and is based in Lynchburg, VA (www.cbfleet.com).

dennis obrien nf1Gryphon has been searching for the right acquisition in the over-the-counter sector for several years, believing that the sector will see strong growth, specifically in the feminine hygiene sub-category.  “Fleet Laboratories has a commanding position in the over-the-counter and personal healthcare product areas, which we have closely followed for several years,” said Dennis O’Brien, a partner at Gryphon.  “We believe the over-the-counter sector is poised for continued expansion as consumers migrate toward more economical non-prescription products and that Fleet has unique and differentiated capabilities to serve these markets. Additionally, the company’s strong brand advantage in the personal healthcare segment under the leading feminine hygiene brand, Summer’s Eve, is a springboard for strong future growth.”

stimson nf2Gryphon intends to grow Fleet both organically and through add-on acquisitions. “Fleet Laboratories is a true platform that provides an excellent opportunity from which to make numerous add-on acquisitions in desirable categories,” said Keith Stimson, a Gryphon partner.  “Fleet has a long history of innovation and responsiveness to customer needs, which is coupled with a growing acceptance and awareness of over-the-counter and personal healthcare products among consumers, resulting in a well-run company with a bright future.”

Golub Capital was the Sole Lead Arranger and Administrative Agent on a senior credit facility to support the acquisition of Fleet Laboratories (click HERE to see related story).

Houlihan Lokey acted as exclusive financial advisor to Gryphon and TM Capital acted as exclusive financial advisor to Fleet on the transaction. Kirkland & Ellis acted as legal advisor to Gryphon and Hunton & Williams and Edmunds & Williams were the legal advisors to Fleet Laboratories.

2014 PEPD • Private Equity’s Leading News Magazine • 10-26-14

Altamont Acquires into Legacy ER & Urgent Care

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legacy er nf1Altamont Capital Partners and the Kingfish Group have made a majority equity investment in Legacy ER & Urgent Care, an operator of hybrid standalone emergency room and urgent care clinics.

Legacy ER & Urgent Care currently operates two clinics in the Dallas metropolitan area which provide unscheduled medical treatment services that triages patients to receive the appropriate level of care required. The company was founded in 2008 and is based north of Dallas in Frisco, TX (www.legacyer.com).

joseph hutts nf1Upon closing of the transaction, Altamont and Kingfish hired Joseph Hutts to be the new CEO of Legacy.  Mr. Hutts was previously CEO of Surgis, the nation’s largest private ambulatory surgical services company prior to its acquisition by United Surgical Partners in 2006. After his tenure at Surgis, Mr. Hutts founded Breathe America, an operator of allergic, sinus and asthma treatment centers.  The founders of Legacy – Doctors Kirk Mahon, Steve Martz and Jay Woody – will remain involved with Legacy post closing.

According to Mr. Hutts, the Legacy model maximizes emergency and urgent care treatment while maintaining appropriate controls on cost. “Legacy has built the leading brand in emergency and urgent care treatment in the North Dallas area, providing outstanding service to thousands of patients each month. Legacy’s model treats patients appropriately and reduces the unnecessary cost that often results from unnecessary emergency-level care – we believe this is best for patients and for the medical system as a whole. We are looking forward to expanding Legacy’s presence to meet the continued demand for top-notch medical care at an appropriate cost.”

“Legacy has demonstrated the ability to deliver outstanding clinical care while saving time and money for both patients and payers. We think this is a good thing for the healthcare system and are committed to providing resources to support Legacy’s continued success,” added Casey Lynch, Managing Director at Altamont.

Altamont Capital Partners invests in middle market businesses with specific interest in the financial services, government services, consumer/retail, industrials and healthcare sectors. Altamont was formed in 2010 by Jesse Rogers, Randall Eason and Keoni Schwartz who previously worked together at Golden Gate Capital and Bain & Company. The firm has over $1 billion of capital under management and is based in Palo Alto (www.altamontcapital.com).

Kingfish Group identifies proprietary investment themes and opportunities by partnering with industry executives and private equity firms. Since founding in 2004, the firm has worked on over 500 transactions alongside several private equity sponsors whose investment interests span an array of industries, styles and strategies. Kingfish Group is based near San Francisco in Foster City, CA (www.kingfishgroup.com).

Christian Dubiel nf1“Legacy has developed a model that combines the best aspects of traditional emergency room and urgent care services to deliver efficient, top-quality care at a reasonable cost,” said Christian Dubiel, Founder of Kingfish Group. “We are excited to partner with Joe Hutts, Altamont and the founders to support the next phase of Legacy’s growth.”

Avondale Partners (www.avondalepartnersllc.com) served as Legacy’s financial advisor on this transaction.

2014 PEPD • Private Equity’s Leading News Magazine • 10-17-14

Fulcrum Equity Partners Acquires Willowbrook Health Systems

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willowbrook nf1Five Points Healthcare, a portfolio company of Fulcrum Equity Partners, has acquired Willowbrook Health Systems, a Medicare-certified home health and hospice provider.

Willowbrook Health Systems operates throughout middle Tennessee and is based in Nashville (www.willowbrookhealth.com).  This is the fourth add-on acquisition completed by Five Points and Fulcrum and serves as the company’s entry into the state of Tennessee for both home health and hospice.

tom greer nf1“We’re pleased to once again partner with Five Points in expanding the company’s services into Tennessee,” said Fulcrum Partner Tom Greer. “This acquisition has tremendous growth potential in the state, and we’ll continue to work with CEO Rob Radics and the Five Points management team to identify future high-quality acquisitions.”

Five Points Healthcare owns and operates home health and hospice locations in Louisiana, Tennessee and Virginia. The company was founded in 2011 and is based in Atlanta (www.fivepointshc.com).

Fulcrum Equity Partners invests from $1 million to $10 million in companies that have revenues of $2 million to $75 million and are based in the Southeast.  Sectors of interest include healthcare, information technology and technology-enabled operating companies.  Fulcrum has $140 million in capital under management and is based in Atlanta (www.fulcrumep.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 10-13-14

SFW Sells MD Buyline to Arsenal

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md buyline nf1SFW Capital Partners has completed the sale of MD Buyline, a provider of healthcare analytics and data, to TractManager, a portfolio company of Arsenal Capital Partners.  SFW acquired MD Buyline in February 2011.

MD Buyline is a provider of healthcare analytics and supply chain spend intelligence to healthcare providers and vendors.  The company’s services are used to identify cost reduction opportunities for purchased services, consumables, capital and IT. MD Buyline is based in Dallas (www.mdbuyline.com).

TractManager is a provider of compliance services that enable hospitals to create, oversee and manage their contractual agreements in compliance with regulations.  TractManager was founded in 1999 and is based in Chattanooga, TN with executive offices in Saddle Brook, NJ (www.tractmanager.com).

During the course of SFW’s ownership the firm supported CEO Satin Mirchandani and the company’s management team in a range of growth initiatives, including enhancing and extending its product lines, investing in the company’s sales, marketing and account management functions, and strengthening the company’s business infrastructure.  These investments enhanced MD Buyline’s service offering for its customers and extended coverage to include information on consumables and purchased services and other areas of hospital spend, each of which drove meaningful growth at the company.

Satin Mirchandani nf1“We are incredibly proud of the transformational improvements we enacted with the support and guidance of SFW,” said Satin Mirchandani, CEO of MD Buyline.  “We are eager to begin the next phase of MD Buyline’s development with TractManager, and are looking forward to providing even greater value to our customers.”

SFW Capital Partners focuses exclusively on analytical tools and related services companies, including providers of instrumentation, software, information and analytical services. SFW typically invests from $10 million to $75 million of equity in middle market companies that have up to $25 million in EBITDA. The firm has offices in Rye, NY and Hudson, OH (www.sfwcap.com).

“MD Buyline’s focus on health-care analytics and information was a strong fit with SFW’s specialization and focus on providers of analytical tools and related services companies.  We are very pleased to have had the opportunity to work closely with Satin Mirchandani and the company’s management team to transform the business and position it for long term growth and success.  The company has performed very well during our time working together, and has further established its position as the leading provider in its field.” said Roger Freeman, Partner at SFW.

The sale of MD Buyline represents the second exit for SFW in recent weeks, following the sale of agricultural analytical solutions provider AGDATA in late July.

2014 PEPD • Private Equity’s Leading News Magazine • 8-5-14

Riverside Invests in Censis Technologies

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censis nf1The Riverside Company has invested in Censis Technologies, a provider of surgical instrument tracking services.

Censis provides SaaS-based surgical instrument tracking and workflow services for sterile processing departments (SPDs) of hospitals and ambulatory surgical centers.  Censis’ services are used to ensure the accuracy and procedural compliance of SPDs which are responsible for assembling instrument trays for surgical procedures (trays can include hundreds of instruments); sterilizing instruments; and managing and maintaining inventory. The company’s flagship product, Censitrac, provides customers with a real-time dashboard that can locate a specific tray within a hospital and automatically alerts users of issues such as incorrect assembly, insufficient sterilization, missing instruments, or instruments requiring maintenance.  Censis is based in Franklin, TN (www.censis.net).

loren sch nf1“Censis’ products address a number of pain points for medical providers,” said Riverside Managing Partner Loren Schlachet. “Its web-based Censitrac software gives healthcare providers exact details on the location, processing and assembly of instrument trays. This helps ensure patient safety and makes facilities more effective and efficient in delivering care.”

Working with Mr. Schlachet and Mr. Sauer on the transaction for Riverside were Operating Partner Jeff Goodman, Assistant Vice President Garrett Monda and Associate James Zhang. Riverside Vice President Dan Haynes worked on financing the transaction for the firm.

The Riverside Company is a private equity firm focused on the smaller end of the middle market (“SEMM”). Riverside specializes in investing in SEMM companies (those valued up to $250 million) and partners with management teams to build companies through acquisitions and value-added growth. Since 1988, the firm has invested in more than 340 transactions with a total enterprise value of more than $6 billion. The firm’s current portfolio includes more than 70 companies. The Riverside Company is headquartered in New York with additional offices in Atlanta, Chicago, Cleveland, Dallas, Los Angeles, San Francisco, and London (www.riversidecompany.com).

sauer nf“As hospitals face the increasing demands of more regulation and the need to be more efficient while delivering exceptional care, the service Censis provides will become even more valuable,” said Riverside Partner Brian Sauer. “Censis delivers a cost-effective way to increase compliance and improve patient outcomes, while delivering a high ROI. It’s a great business.”

PNC and Saratoga Partners provided financing for the transaction. Riverside was advised by Jones Day and Deloitte. Censis was advised by Triple Tree.

2014 PEPD • Private Equity’s Leading News Magazine • 7-28-14

Seacoast Capital Invests in Walden Behavioral Care

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walden beh nf1Seacoast Capital has completed an investment in Walden Behavioral Care, a provider of behavioral health services for individuals with eating disorders.

Walden Behavioral Care is a behavioral health organization with multiple levels of care and includes a psychiatric hospital that treats eating disorders and psychiatric disorders. It is the only facility in New England that provides inpatient, residential, partial hospitalization and intensive outpatient care for patients with eating disorders. It is also the only facility in New England that provides dedicated inpatient care for mood disorders. Walden has satellite locations in Braintree, Worcester and Northampton, MA and South Windsor, CT. The company was founded in 2003 by Dr. Stuart Koman and is headquartered in Waltham, MA (www.waldenbehavioralcare.com).

gorman nf1“Dr. Koman and his team have built an extraordinary company dedicated to assisting both individuals and their families struggling with eating disorders and related mental health issues,” said Tom Gorman, Partner at Seacoast Capital.  “We were attracted to the combination of Walden’s core mission and the effectiveness of their programs. We are excited to partner with Walden and provide the necessary support to enable management to execute on its growth strategy.”

Seacoast Capital provides between $3 million and $12 million of debt and equity capital for acquisitions, growth, shareholder buyouts, management buyouts, and leveraged recapitalizations. While industry agnostic, Seacoast has a particular interest in the specialty manufacturing, value-added distribution, and business services sectors.  Seacoast targets investments in companies with $10 million to $150 million in revenue and $2 million or more of EBITDA. Seacoast is currently investing its third fund, Seacoast Capital Partners III, with $150 million of capital commitments.  The firm was founded in 1994 and has offices in Boston and San Francisco (www.seacoastcapital.com).

2014 PEPD • Private Equity’s Leading News Magazine • 7-18-14

Francisco Partners Acquires Health Robotics

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health robotics nf1Aesynt, a provider of pharmacy automation services and a portfolio company of Francisco Partners, has acquired Health Robotics, a supplier of automated technology for intravenous medication preparation, compounding and dispensing.

Health Robotics provides integrated intravenous (IV) compounding and dispensing devices to hospitals and health systems.  Brand names include i.v.STATION, i.v.SOFT and i.v.STATION ONCO. The company’s robotics-based IV automation services support more safe and efficient production of ready-to-administer IVs, thereby helping to reduce medication errors, increase medication throughput and lower costs associated with IV compounding and dispensing. Health Robotics was founded in 2006 and is based in Bolzano, Italy (www.health-robotics.com/en).

Under the terms of the agreement, Aesynt assumed complete ownership of Health Robotics, with all 65 employees immediately joining Aesynt. Founder-entrepreneurs Fabio Fioravanti and Gaspar DeViedma will remain with the company as Managing Directors of Research, Development & Operations and Global Commercialization, respectively. R&D and operations for IV automation products will continue to be headquartered in Italy.

“The acquisition of Health Robotics, the market leader in IV automation, perfectly aligns with Aesynt’s growth strategy, as it allows us to offer the most complete portfolio of pharmacy automation solutions on the market,” said Kraig McEwen, CEO at Aesynt. “The cost, footprint and throughput benefits of Health Robotics’ next-generation products truly set them apart and will enhance our comprehensive suite of solutions. This further advances our mission of helping hospitals and health systems improve outcomes, build stronger businesses and better manage change.”

Aesynt, previously named McKesson Automation prior to its acquisition by Francisco Partners in November 2013, offers pharmacy automation services to hospitals and health systems. The company offers a range of products addressing every stage of medication delivery within a hospital, including pharmacy, nursing and surgical services. The company is based in Pittsburgh (www.aesynt.com).

Francisco Partners makes investments in technology companies with transaction values ranging from $50 million to $2 billion. Transaction structures include buyouts, divisional divestitures, recapitalizations, restructurings and growth equity financings. Francisco Partners is headquartered in San Francisco (www.franciscopartners.com).

© 2014 PEPD • Private Equity’s Leading News Magazine • 4-4-14

Kinderhook Acquires GlobalHealth

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globalhealth nfKinderhook Industries has acquired GlobalHealth, an Oklahoma health maintenance organization (HMO). GlobalHealth is Kinderhook’s seventh healthcare platform investment and eighteenth purchase in the healthcare services space, including add-on acquisitions.

GlobalHealth is an HMO serving over 40,000 individuals, employers, Medicare beneficiaries, federal employees, and state, education and municipal government employees, in Oklahoma. GlobalHealth is one of five companies offering health plan options on the Federal Healthcare Marketplace in Oklahoma. The company is headquartered in Oklahoma City and has an additional office in Tulsa (www.globalhealth.com).

“We are excited about our new partnership with Kinderhook which will enable us to expand our affordable health plans to more citizens in Oklahoma,” said Scott Vaughn, CEO of GlobalHealth. “Our mission is to make quality healthcare more affordable for the communities we serve. The Kinderhook team shares our strategic vision of bringing our unique healthcare delivery model to more Oklahomans and creating more consumer choices in the marketplace.”

Kinderhook Industries makes control investments in companies with transaction values of $10 million to $75 million in which the firm can achieve financial, operational and growth improvements. The firm pursues private equity investments in non-core divisions of public companies, management buyouts of entrepreneurial-owned businesses, troubled situations and existing small capitalization companies lacking institutional support. The firm, founded in 2003, has $770 million of committed capital and is based in New York (www.kinderhook.com).

michalik nf2“Under Scott’s leadership, GlobalHealth has served its members very well and has made great strides toward bending the healthcare cost curve through its common sense approach to healthcare delivery,” said Chris Michalik, Managing Director at Kinderhook. “The combination of GlobalHealth’s unique delivery model and the significant changes to the US healthcare industry creates a tremendous opportunity for GlobalHealth to offer affordable health plans to more citizens in Oklahoma. We are very excited to partner with Scott and his management team and to accelerate the success of GlobalHealth.”

Allegiance Capital Corporation (www.allcapcorp.com) served as financial adviser to GlobalHealth.

© 2014 PEPD • Private Equity’s Leading News Magazine • 2-3-14

Pharos Capital Acquires Seaside Healthcare

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saeside nfPharos Capital Group has acquired behavioral health services provider Seaside Healthcare. The acquisition was done in partnership with the company’s founder, Franklin Roemer, who maintains a significant equity stake in the company.

Seaside is a behavioral health services provider that specializes in treatment services for the adult and geriatric population. Services include inpatient psychiatric treatment, partial hospitalization programs and intensive outpatient programs. Seaside currently operates two inpatient psychiatric facilities that have 54 licensed beds and operates five outpatient clinics. In addition to its owned and leased facility-based operations, Seaside manages 147 behavioral beds for regional hospitals. The company has approximately 400 employees. Seaside was founded in 2009 and is headquartered in Shreveport, LA (www.seasidehc.com).

“Pharos looks forward to working closely with Franklin Roemer and his team of accomplished healthcare operators to capitalize on this rapidly growing segment of the behavioral health space,” said Jim Phillips, Partner at Pharos Capital.

Seaside’s expansion plans include driving increased census to its outpatient programs as well as a 36-bed addition to an existing inpatient facility which will be completed soon. Additionally, Pharos intends to accelerate the company’s growth by acquiring complementary facilities to expand the company’s service offering and geographic footprint.

“We could not be more pleased with the prospects of working with the Pharos team. Pharos shares our vision of excellence in healthcare and this transaction enables Seaside to broaden our vision beyond its current service lines and geography,” said Franklin Roemer, Seaside’s Founder and CEO. “Pharos’ investment along with Seaside’s existing foundation allows us to dream big.”

Pharos Capital Group invests $10 million to $30 million in companies seeking later stage funding for internal growth, acquisitions, management buyouts or recapitalizations. The firm invests across many sectors but has a particular interest in healthcare and business services. Pharos Capital Group has offices in Dallas and Nashville (www.pharosfunds.com).
Stephens, Inc. served as financial advisor to Seaside in connection with the transaction.

© 2014 PEPD • Private Equity’s Leading News Magazine • 1-13-14

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