medical services

Housatonic Invests in Accurate Monitoring

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Housatonic Partners has acquired Accurate Monitoring, a provider of outsourced medical monitoring services.

Accurate Monitoring is a provider of outsourced intraoperative neurophysiological monitoring (IONM) services to hospitals and surgical groups throughout New York and New Jersey. IONM is the use of electrophysiological methods – such as electroencephalography (EEG) and electromyography (EMG) – to monitor the functional integrity of certain neural structures (e.g., nerves, spinal cord and parts of the brain) during surgery. Accurate, accredited by The Joint Commission, was founded in 2007 and is headquartered near New York City in Fairfield, NJ (www.accuratemonitoring.com).

Since its founding the company has achieved strong revenue growth and sought a growth equity partner to continue regional and national expansion. “After years of successful growth in New Jersey and New York, we are ready to expand our clinical services to new markets and are pleased to be partnering with Housatonic Partners,” said Accurate CEO Frank Gazzillo. “The expertise and capital that Housatonic brings to the table should enable us to expand our ability to provide high quality outsourced clinical services to new markets.”

Housatonic Partners invests from $10 million to $30 million in buyout or recapitalization transactions. Typical investment targets will have internal revenue growth opportunities; recurring revenues; high EBITDA margins; moderate capital needs; and strong management teams. The firm was founded in 1994 and has offices in Boston and San Francisco (www.housatonicpartners.com).

Capstone Partners (www.capstonepartnerslp.com) was the financial advisor to Accurate Monitoring on this transaction. “Healthcare providers are increasingly relying on outsourced service providers with the experience and clinical skill sets to help enhance patient safety, lower costs through reduced patient stays, respond quickly to fluctuating patient levels/demand, and avoid expensive and resource consuming hospital readmissions,” said Eric Williams, a Managing Director of Capstone. “As a result, we expect the outsourced clinical services sector to experience heightened M&A activity as private equity and strategic suitors look to capitalize on favorable demographic and industry trends.”

“The IONM sector, which is highly fragmented and benefiting from an aging population and an increased prevalence of chronic disease, has seen two major deals completed within the past few months. In addition to the Accurate transaction, medical device company NuVasive acquired IONM provider Biotronic NeuroNetwork for $98 million in July 2016,” said Mark Surowiak, a Director at Capstone.

© 2016 Private Equity Professional • 9-29-16

Revelstoke Completes Two More Add-ons to Schryver

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Schryver Medical Sales and Marketing, a portfolio company of Revelstoke Capital Partners, has completed the acquisitions of Main Street Clinical Laboratory and On-Site Imaging Solutions.  These two acquisitions follow Schryver’s January 2015 acquisition of Nashville-based Quality Mobile X-Ray.

Main Street Clinical Laboratory is a CLIA certified clinical laboratory that provides a test menu of laboratory services to physicians and other healthcare providers. The Clinical Laboratory Improvement Amendments of 1988 (CLIA) regulations include federal standards that are applicable to all US facilities that test human specimens for health assessment or to diagnose, prevent, or treat disease.  Main Street’s service area includes Mississippi, Tennessee and Arkansas. Main Street Clinical Laboratory is based south of Memphis in Southaven, MS (www.mainstreetlab.com).

On-Site Imaging Solutions provides mobile imaging to nursing homes, healthcare facilities, hospice centers, correctional facilities and home health patients throughout Arkansas. On-Site also offers EKG, ultrasound, and cardiac imaging services. The company is based in Little Rock, AR (www.myonsiteimaging.com).

Schryver Medical, acquired by Revelstoke in July 2014, is a provider of mobile imaging diagnostics, clinical laboratory services, oxygen therapy and durable medical equipment rental. Schryver serves nearly 3,000 long term post-acute facilities, assisted-living centers, and skilled nursing facilities, as well as numerous homecare patients.  The company has approximately 500 employees and is headquartered in Denver (www.schryvermedical.com).

“We are excited to see our operations in the southeastern United States expand,” said Doug Goetz, CEO of Schryver. “Main Street and On-Site are both strategic to our goals and support the momentum we have gained in the southeast. These transactions serve as important steps in our continued effort to grow the Schryver footprint and offer services at a national level.”

“The resources, expertise, and strategy that Schryver has leveraged in building its reputation as a market leader will translate into continued success,” said Mark King, CEO, Managing Partner and Co- Founder of Revelstoke. “We are pleased by the Schryver team’s continued ability to identify and integrate add-on opportunities.”

Revelstoke invests from $10 million to $250 million in companies that have at least $5 million of EBITDA.  Sectors of interest include healthcare services and products; transportation and logistics; specialty distribution; energy and energy services; building products; business and outsourced services; marketing services; financial services; industrial services; and medical technology. The firm was founded by Managing Partners – Mark King, Dale Meyer, and Simon Bachleda – and is headquartered in Denver (www.revelstokecp.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 7-21-15

Sterling Acquires Surgical Solutions

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Sterling Partners has acquired Surgical Solutions, a provider of support and equipment for surgical procedures.

Surgical Solutions provides hospitals and surgeons with support and equipment for endoscopic and laparoscopic surgical procedures. The company’s technicians provide preoperative room setup, intra-operative technical support, and postoperative room turnover.  Surgical Solutions also purchases all laparoscopic instrumentation and creates surgeon specific sets, tailored to the surgeon’s individual needs and preferences. Other services include repairs and maintenance and technical support.  Surgical Solutions was founded in 2007 by Eric Stinson and Alex Kellen and is headquartered in Henderson, KY (www.surgical-solutions.org).

“Only those innovative healthcare services companies that consistently deliver quality and value to patients at a lower cost to the system will have staying power in this industry,” said Danny Rosenberg, Managing Director at Sterling Partners. “Surgical Solutions is one of those companies.”

“Because Surgical Solutions provides a unique, niche service within the marketplace, we’ve become an industry leader by increasing efficiencies, boosting volume, and cutting costs, without sacrificing quality,” said Mr. Stinson. “But in order to scale our business and become the company we know we can be, we needed a partner. Sterling Partners not only brings an entrepreneurial mindset to the table, they also bring the financial and intellectual capital we need to reach our goals.”

Sterling Partners focuses on investing growth capital in small and mid-market companies in industries with positive, long-term trends, including education, healthcare, and business services.  Sterling manages over $5 billion in institutional capital. The firm was founded in 1983 and has offices in Chicago, Baltimore, and Miami (www.sterlingpartners.com).

“Hospital administrators are eager to find new ways to save money while promoting ‘physician-friendly’ facilities and delivering the highest quality of care. That is exactly what Surgical Solutions allows them to do,” said Kim Vender Moffat, Principal at Sterling Partners. “We’re thrilled to partner with Eric Stinson and his team, to take what they’ve built and help them to further scale that service while not losing focus of the company’s founding mission and service orientation.”

Surgical Solutions is now the eighth company in Sterling’s active healthcare services portfolio, with an additional six companies previously exited.

© 2014 PEPD • Private Equity’s Leading News Magazine • 12-2-14

Riverside Acquires RS Occupational Health

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The Riverside Company continues to expand its DISA Global Solutions platform with the recent acquisition of RS Occupational Health, a provider of medical services to the energy industry.

RS Occupational Health (RSOH) provides occupational health services including remote emergency services via three UK clinics located in Aberdeen (headquarters) and Inverness, Scotland and Great Yarmouth, England. (www.rsoh.co.uk).

“The addition of RSOH marks the third add-on acquisition DISA has completed under Riverside’s ownership,” said Riverside Managing Partner Loren Schlachet. “We’re excited about what it brings to DISA. RSOH clinics are in key energy production areas, and will greatly enhance DISA’s international footprint and capabilities.”

DISA Global Solutions provides workplace safety and compliance services with a particular focus on the energy sector. The company has more than 11,000 customers and is based in Houston (www.disa.com).

“DISA is already a world-class global company,” said Riverside Partner Brian Sauer. “Adding locations and enhancing service offerings in a vital energy production region will only serve to make DISA even more capable and successful.”

Working with Messrs. Schlachet and Sauer on the transaction for Riverside were Associate Danielle Leimbach, Operating Partner Dan Colbert and Operating Executive – Finance David Pecore.

The Riverside Company is focused on the smaller end of the middle market and invests in businesses valued at up to $250 million (€200 million in Europe). Since 1988, the firm has invested in more than 330 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).

Fifth Street provided financing for the transaction. Jones Day UK and KPMG UK provided DISA with legal counsel and accounting support, respectively.

© 2014 PEPD • Private Equity’s Leading News Magazine • 3-20-14

LongueVue Capital Invests In Prime Health Services

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LongueVue Capital has invested $8 million of senior secured debt in Prime Health Services, a provider of medical cost containment services.

“Prime Health has become a leading provider of cost containment solutions in a niche market and is recognized for providing high quality and customized solutions for its customer base,” said John McNamara, Co-founder and Managing Partner of LongueVue Capital. “We are enthused to partner with the company and provide capital in support of the build out of Prime’s capabilities to support the workers’ compensation, auto and corrections markets.”

Prime Health is a diversified medical cost containment company that offers a variety of services, including a nationwide preferred provider organization (PPO) as well as medical cost containment. Prime Health’s cost containment services are tailored to the workers’ compensation, auto liability and corrections markets. The company’s customer base includes insurance companies, third party administrators, and self-insured employers. Prime Health was founded in 2001 and is headquartered near Nashville in Brentwood, TN (www.primehealthservices.com).

“We are excited about our partnership with LongueVue Capital and appreciate the opportunity to partner with such an experienced institutional investor,” said Prime Health President and Chief Executive Officer, Brian Sharp. “This financing enables our company to continue to focus on the evolving needs of our customers as we develop a breadth of offerings that will create additional savings within the complex healthcare system.”

LongueVue Capital makes equity and debt investments in lower middle market companies that have up to $100 million of revenue. Sectors of interest include manufacturing, business services, energy services, and third party logistics. The firm was founded in 2001 and is based in New Orleans with additional offices in New York and Salt Lake City (www.lvcpartners.com).

Prime Health was advised by TGP Securities on the transaction (www.tgpsecurities.com).

© 2014 PEPD • Private Equity’s Leading News Magazine • 3-20-14

Water Street and JLL Merge Clinical Services Portfolio Companies

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Water Street Healthcare Partners and JLL Partners have merged their portfolio companies CCBR-SYNARC and BioClinica to create a global provider of specialty outsourced clinical services. CCBR-SYNARC was acquired by Water Street in April 2013 and JLL Partners acquired BioClinica in January 2013.

“This merger creates a market leader uniquely positioned to support pharmaceutical companies with managing key components of their clinical trials,” said Peter Strothman, a Partner at Water Street.

Earlier this year, the two investment firms reached an agreement to merge the two companies and recruited Jeffrey McMullen, an executive with 40 years of experience in the drug development industry, to serve as chairman.

“Together, CCBR-SYNARC and BioClinica offer the industry’s most comprehensive clinical imaging program across all major therapeutic areas that can interact with any contract research organization. In addition, they offer complementary services and software solutions in the high-growth areas of patient recruitment and clinical development,” said Mr. Strothman.

Together, CCBR-SYNARC and BioClinica support pharmaceutical and biotechnology companies with a portfolio of outsourced services that include: medical imaging analysis and consultation that track the effectiveness of new drugs and medical devices across major therapeutic areas, including oncology, neurology, musculoskeletal and cardiology; patient recruitment through a network of 26 dedicated research centers that enroll and retain qualified patients from targeted geographies to participate in trials; software and consulting services that improve the efficiency and management of the drug development process; cardiovascular safety and efficacy that measure the effects of compounds under development on cardiac health, and; central Lab Services that analyze biological samples originating from Phase I-IV trials. BioClinica is based in Newtown, PA (www.bioclinica.com) and CCBR-SYNARC is headquartered in Copenhagen (www.ccbr.com).

“Pharmaceutical and biotechnology companies are increasingly turning to outside specialists to help them manage the cost and complexities of drug development. As one entity, CCBR-SYNARC and BioClinica offer a combination of scientific expertise, clinical trial experience and advanced technologies that solve challenges across the drug development continuum. Their solutions are proven to reduce clinical trial costs, shorten drug development time, and improve data quality and compliance,” said Dan Agroskin, partner, JLL Partners.

JLL Partners seeks to invest in companies across a range of manufacturing and service industries. Sectors of specific interest include healthcare services, medical products, food and consumer products, chemicals, broadcasting, transportation, automotive, industrial manufacturing, and distribution. JLL Partners is based in New York (www.jllpartners.com).

Water Street Healthcare Partners targets investments ranging from $50 million 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).

© 2014 PEPD • Private Equity’s Leading News Magazine • 3-12-14

Persistence Capital Partners Exits Lab-Biomedic

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Persistence Capital Partners has sold its portfolio company, Lab-Biomedic, to Gamma-Dynacare, a Canadian subsidiary of publicly traded Laboratory Corporation of America. Persistence acquired Lab-Biomedic in 2010.

Lab-Biomedic provides clinical laboratory services to medical clinics, corporate clients, insurance companies and clinical research organizations. Clinical specialties include cytopathology and screening for respiratory and food allergies. Lab-Biomedic serves a range of eastern Canadian clients through its laboratories in Montreal and Quebec City. The company was founded in 1998 (www.labbiomedic.com).

“Lab-Biomedic represents a benchmark for service and excellence in the clinical laboratory, insurance, and contract research sectors in Canada,” said Lloyd Segal, Managing Partner at Persistence. “It has been a privilege collaborating with Marc Hamilton and his team, as they have set a new standard for innovation and delivered outstanding returns to Persistence. We wish them continued success as they become part of Gamma-Dynacare.”

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).

Laboratory Corporation of America (NYSE: LH) operates one of the largest clinical laboratory networks in the world, with a United States network of 36 primary laboratories. Before a merger with National Health Laboratory in 1995, the company operated under the name Roche BioMedical. LabCorp performs its largest volume of specialty testing at its Center for Esoteric Testing and headquarters in Burlington, NC (www.labcorp.com).

© 2014 PEPD • Private Equity’s Leading News Magazine • 1-17-14

Carlyle Group to Acquire Johnson & Johnson’s Ortho-Clinical Diagnostics

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The Carlyle Group has agreed to acquire Johnson & Johnson’s Ortho-Clinical Diagnostics business for $4.15 billion. Equity for the transaction comes from Carlyle Partners VI, a $13 billion fund which closed above target in November 2013. The transaction is expected to close in the middle of 2014.

Ortho-Clinical Diagnostics (OCD) provides screening, diagnosing, monitoring and disease confirmation services to the clinical laboratory and transfusion medicine sectors. Customers include hospitals, laboratories and blood centers worldwide. OCD is headquartered in Raritan, NJ, with manufacturing operations in Rochester, NY; Pompano Beach, FL; and Pencoed, Wales (www.orthoclinical.com).

“Ortho-Clinical Diagnostics is an established global brand with a reputation for quality and innovation. Through accelerated investment in research and product development and continued expansion into both emerging and established markets, we expect to tap into rising demand for sophisticated medical diagnostic products and services worldwide,” said Stephen Wise, a Managing Director of The Carlyle Group.

The Carlyle Group invests in buyouts, growth capital, real estate and leveraged finance in Africa, Asia, Australia, Europe, North America and South America. The firm employs 1,450 people in 34 offices across six continents and is based in Washington, DC (www.carlyle.com).

“We have been focused on the diagnostics industry for many years given its attractive growth prospects, driven by the crucial role it plays in health care decision-making and influencing patient outcomes,” said Mr. Wise. “We believe that OCD, with its world class employee base and talented management team, is poised for the next level of success.”

Barclays and Goldman Sachs are acting as financial advisors to The Carlyle Group, which has secured committed debt financing from Barclays, Goldman Sachs, Credit Suisse, UBS and Nomura. Latham & Watkins is acting as legal advisor to Carlyle.

© 2014 PEPD • Private Equity’s Leading News Magazine • 1-16-14