Healthcare

ClearLight Partners Exits The Outsource Group

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ClearLight Partners has entered into an agreement to sell The Outsource Group to Parallon Business Solutions. The transaction is expected to close by the end of this month.

The Outsource Group (TOG) provides revenue cycle management services to more than 160 hospital clients and physician practices across 38 states. Services include full business office outsourcing, insurance billing and follow up, third-party liability, primary and secondary bad debt collections, Medicaid eligibility, early out/self-pay, onsite financial counseling and physician billing and follow up. The company has annual revenues in excess of $100 million and is headquartered in St. Louis (www.theoutsourcegroup.com).

ClearLight initially invested in TOG in December 2004 in partnership with Chief Executive Michael DiMarco. During its term of ownership ClearLight grew the company organically and through a dozen add-on acquisitions. “We identified a trend towards hospitals outsourcing management of their revenue cycle and saw an opportunity to build TOG into a best-in-class provider,” said Patrick Haiz, a partner at ClearLight.

“It has been a pleasure working with ClearLight in growing TOG,” said Michael DiMarco. “Going forward, the company is well positioned to continue its strong growth as part of Parallon, providing excellent service to TOG’s existing clients as well as offering its revenue cycle services to HCA’s extensive network of hospitals and surgery centers.”

ClearLight Partners invests from $10 million to $50 million in US or Canadian based middle market companies with revenues from $20 million to $250 million and EBITDAs from $5 million to $25 million. Sectors of interest include specialty manufacturing and distribution; business services; and consumer products and services. The firm has $600 million of assets under management and is based in Newport Beach, CA (www.clearlightpartners.com).

“We are proud of our association with Michael DiMarco and the team at TOG, and of their accomplishments,” said Michael Kaye, Managing Partner of ClearLight. “Working with talented executives to execute against a well-defined investment thesis that includes strong organic growth as well as selective fold-in acquisitions is one of our preferred ways to build value. We think that Parallon will be an excellent new home for the company and are pleased to deliver an attractive return to ClearLight’s investors.”

Parallon is provider of business and operational services to hospitals, healthcare systems and non-acute care providers. Services include revenue cycle management; technology consulting; workforce management; group purchasing and supply chain management. The company is a wholly-owned subsidiary of HCA Holdings (NYSE: HCA). Parallon is based in Franklin, TN (www.parallon.net).

ClearLight was advised by Cain Brothers & Company, a healthcare investment bank with offices in New York, Chicago and San Francisco (www.cainbrothers.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 6-12-13

Water Street Acquires Medical Technology Resources

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Medical Specialties Distributors, a portfolio company of Water Street Healthcare Partners, has acquired Medical Technology Resources. Water Street first invested in Medical Specialties Distributors in 2010.

Medical Technology Resources (MTR) specializes in providing infusion pumps and related products, as well as biomedical and billing services, to alternate-site health care providers. The company is based in Columbus, OH (www.mtrhealth.com).

Medical Specialties Distributors (MSD) is a provider of infusion products, supplies, biomedical and distribution services, and technology services to the home infusion and oncology markets. MSD serves a base of 2,500 customers, including specialty pharmacies, home infusion companies and oncology clinics. The company is based in Stoughton, MA (www.msdonline.com).

“We identified MTR as an ideal acquisition for MSD several years ago. MTR builds on MSD’s core capabilities in product distribution and biomedical services and increases its presence in the Midwest geography. Longer-term, it expands MSD’s unique position as the leading national distributor dedicated to serving the growing numbers of home infusion providers,” said Rob Womsley, a partner with Water Street and chairman of MSD.

Water Street Healthcare Partners targets investments ranging from $50 to $500 million in four health care sectors: distribution, medical products, health care services, and pharmaceutical products and services. The firm has particular expertise in corporate divestitures from healthcare companies. Water Street has more than $1 billion of capital under management and is based in Chicago (www.waterstreet.com).

“MTR’s unique product offerings and strong presence in the Midwest enhances our leadership position in the growing home infusion and oncology markets,” said James Beck, president and CEO, MSD. “Over the past three years, we have grown our national footprint through partnerships with multi-site health care providers and strategic relationships with leading manufacturers. This acquisition is one more step toward our goal of creating a stronger growth platform for MSD.”

© 2013 PEPD • Private Equity’s Leading News Magazine • 6-11-13

Moelis Capital Partners Acquires New Jersey Anesthesia Group

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North American Partners in Anesthesia, an anesthesia and perioperative management company and a portfolio company of Moelis Capital Partners, has acquired New Jersey Anesthesia Group.

New Jersey Anesthesia Group (NJAG) provides anesthesia services for St. Joseph’s Regional Medical Center, St. Joseph’s Wayne Hospital, Meadowlands Hospital Medical Center, and St. Michael’s Medical Center. In addition, NJAG provides anesthesia services to more than 12 outpatient facilities in the region. Total Pain Care, a division of NJAG that provides pain management services, was also included in the transaction. NJAG was founded in 1988 and is based in Paterson, NJ (no website found).

North American Partners in Anesthesia (NAPA) is an anesthesia management company. The company partners with hospitals and other health care facilities to provide anesthesia and perioperative services. NAPA was acquired by Moelis Capital Partners in April 2011. The company is based in Melville, NY (www.napaanesthesia.com).

“From our first interactions with NJAG leadership, it was clear that NAPA and NJAG shared a similar clinical philosophy and approach to delivering care,” said Timothy Dowd, CEO and Managing Partner of North American Partners in Anesthesia. “As NAPA looks to strategically expand, we are seeking high quality practices with a strong leadership and focus, which is exactly what NJAG embodies.”

Moelis Capital Partners is a middle market private equity firm founded in 2007 in connection with the formation of Moelis & Company, an independent investment bank. Moelis Capital Partners manages $800 million of committed private equity capital and specializes in traditional private equity investments in the middle market. The firm is based in New York (www.moelis.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-23-13

Vicente Acquires Precision Diagnostic Systems and SleepEasy Therapeutics

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MedBridge Healthcare, a portfolio company of Vicente Capital Partners, has acquired Precision Diagnostic Systems, a provider of sleep disorder services, and SleepEasy Therapeutics, a provider of sleep disorder products.

These acquisitions extend MedBridge Healthcare’s geographic footprint into Minnesota, North Dakota, South Dakota, Illinois, Iowa, Michigan, and Wisconsin, making the company the second largest provider of sleep diagnostic services and respiratory therapy services in the United States.

Precision Diagnostic Systems (PDS) is a provider of sleep disorder diagnosis and testing services. The company was founded in 1998 and is based in Fargo, ND (www.pdssleep.com).

SleepEasy Therapeutics (SET) is a provider of continuous positive airway pressure products (CPAP) including nasal masks, tubing and related accessories. The company operates stores in Fargo and Grand Forks, ND; Sioux Falls, SD; and St. Cloud, MN (www.sleepeasyrx.com).

“We are very excited about MedBridge’s acquisition of these two companies. The combined businesses complement each other very well and the acquisition solidifies MedBridge’s position as one of the largest healthcare platforms in the sleep disorder and continuous positive airway pressure products therapy market,” said Klaus Koch, Managing Partner of Vicente Capital Partners and Chairman of the Board of MedBridge Healthcare. “Matt Mellott and the team at MedBridge have been laser focused on the buy and build strategy that they laid out when we partnered with them to acquire MedBridge, and we are pleased to be able to support them.”

MedBridge Healthcare was acquired by Vicente Capital Partners in 2008 and is a provider of diagnostic services and respiratory therapy services for patients with Obstructive Sleep Apnea (OSA) and other sleep disorders. The company provides services for patient identification, testing, diagnosis, treatment, and long-term care management of OSA patients. The company was founded in 2004 and is based in Greenville, SC (www.medbridgehealthcare.com).

Vicente Capital Partners makes non-control and control investments in businesses that have annual revenues between $5 million and $50 million. Sectors of interest include business services (outsourced services, Internet services, telecom services); consumer services (healthcare services, residential delivery, education); and specialty manufacturing (aerospace & defense, environmental products, networking/telecom equipment). The firm is based in Los Angeles (www.vicentecapital.com).

“This was truly a unique opportunity to acquire two of the premier businesses in the sleep diagnostic and CPAP therapy management market in the Midwest,” said Matt Mellott, President of MedBridge Healthcare. “We are very excited about the potential to leverage the platform that we have built at MedBridge and the talent and resources at PDS and SET to continue to meet the needs of the 50 million Americans that have sleep disorders.”

© 2013 PEPD • Private Equity’s Leading News Magazine • 5-1-13

Persistence Capital Partners Acquires Plexo

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Medisys Corporate Health, a provider of health services and a portfolio company of Persistence Capital Partners, has acquired Plexo, a provider of corporate health services based in Quebec.

“This acquisition will help support our mission to provide corporations with preventive health services that are customized, efficient and effective. We look forward to welcoming Plexo’s team of 150 employees and over 200 physicians, who will continue to deliver excellent client service as part of Medisys,” said Jean Bourcier, President of Medisys.

Plexo is a provider of corporate health services and operates clinics in Montreal, Trois-Rivieres and Drummondville. The company was founded in 1988 and is based in Montreal (www.plexo.ca/en).

“In this fragmented industry with few national providers, there is an opportunity to provide outstanding corporate health services to our clients, be they local, regional or national,” said Dr. Sheldon Elman, Founder and Chairman of Medisys. “The acquisition of Plexo is an important step forward in our strategy to consolidate and reinforce our position as the leading national corporate health services provider.”

Medisys Corporate Health is a provider of healthcare services to individuals and corporations. Medisys provides preventive, diagnostic and consultative healthcare services to more than 4,000 corporations. The company operates facilities in Montreal, Toronto, Ottawa, Calgary, Vancouver and Quebec City. Medisys was founded in 1987 and is headquartered in Montreal (www.medisys.ca/en).

Persistence Capital Partners invests in Canadian based or operated healthcare companies that have EBITDAs from $1 million to $10 million. The firm is headquartered in Montreal (www.persistencecapital.com).

© 2013 PEPD • Private Equity’s Leading News Magazine • 4-25-13

Clearview Acquires The Children’s Secret Garden

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Child Health Holdings, a portfolio company of Clearview Capital, has acquired The Children’s Secret Garden, a provider of pediatric extended care services.

The Children’s Secret Garden (“TCSG”) operates a combined prescribed pediatric extended care (PPEC) and day care facility for children with chronically ill and/or medically complex conditions. The company is headquartered in Dover, DE (www.childrenssecretgarden.net).

Child Health Holdings (DBA Pediatric Health Choice) is the largest operator of prescribed pediatric extended care facilities in the country with 16 locations throughout Florida, Pennsylvania, Louisiana and Delaware. The company is based in Tampa (www.pediatrichc.com).

The closing of this transaction represents Pediatric Health Choice’s first add-on acquisition under Clearview’s ownership. “We expect the TCSG acquisition to mark the first of many acquisitions for us over the coming years,” said Steve Barry, Chief Executive Officer of Pediatric Health Choice. “We firmly believe the PPEC model provides the most clinically-effective and cost-efficient setting for chronically ill and/or medically complex children and adolescents, and we believe partnering with Pediatric Health Choice, due to our scale and reputation in the market, will remain an attractive option for smaller operators as the industry continues to consolidate.”

Clearview Capital invests in mid-sized manufacturing and service companies that have cash flow between $4 million and $20 million. Clearview has in excess of $250 million under management and is currently making investments through its committed fund, Clearview Capital Fund II, LP. The firm is headquartered in Old Greenwich, CT (www.ClearviewCap.com).

“We’re excited to announce our first add-on acquisition with Pediatric Health Choice’s management team,” said James Andersen, Managing Partner of Clearview. “The PPEC market is a highly fragmented, growing sector within the healthcare services industry and we will continue to actively pursue add-on acquisitions throughout the country, while maintaining rapid organic growth through de novo expansion.”

© 2013 PEPD • Private Equity’s Leading News Magazine • 4-17-13