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The Healthcare Investor

Insights on Issues & Trends that Impact Investments in Healthcare & Life Science Businesses

Healthcare & Life Sciences Private Equity Deal Tracker: Alpine Investors Portfolio Company Optima Healthcare Solutions Acquires Hospicesoft

Posted in Healthcare Services Investing

Optima Healthcare Solutions has announced it has acquired Hospicesoft.

Optima, a portfolio company of Alpine Investors, is a provider of cloud-based software for post-acute care providers based in Palm City, Fla.

Hospicesoft, headquartered in Salem, Utah, is a supplier of cloud-based software for hospices.

Alpine Investors, based in San Francisco, is a private PE firm that targets investments in middle-market companies in the software, online and business services industries.

Terms of the transaction were not disclosed.

Highland Capital Management Closes Healthcare PE Fund With $147 Million

Posted in Healthcare Services Investing

Highland Capital Management has announced that its affiliate, Highland Capital Management Korea Ltd., has closed a healthcare-focused PE fund, with approximately $147 million of total capital commitments.

The fund will primarily invest in middle-market healthcare companies in North America and Asia.

Highland Capital Management, based in Dallas, stated it has invested $1.4 billion in capital across its PE business.

Surgery Partners to Acquire National Surgical Healthcare for $760 million

Posted in Healthcare Services Investing

Surgery Partners has announced it will acquire National Surgical Healthcare (NSH) from Irving Place Capital for approximately $760 million.

Surgery Partners, based in Nashville, Tenn., is an operator of surgical facilities across the United States. It has more than 150 locations in 29 states, including ambulatory surgery centers (ASCs), surgical hospitals, a diagnostic laboratory, multi-specialty physician practices and urgent care facilities.

NSH, based in Chicago, owns, operates and partners with physicians in the short-stay surgical hospital and ASC industry. NSH owns and operates 21 surgical facilities, specializing in orthopedic surgery, spine and back, pain management and neurosurgery.

Irving Place Capital, based in New York, is a PE firm that targets middle-market companies for a wide range of investments in a number of industries.

Funding for Surgery Partners’ acquisition of NSH will be provided in part by Bain Capital Private Equity. Bain Capital, with North American offices in Boston and New York, invests in several industries, including healthcare.

In conjunction with the transaction, Bain Capital will acquire H.I.G. Capital’s existing equity stake in Surgery Partners. H.I.G. is a PE investment firm based in Boston.

The transaction is expected to close during 2017.

The ASC sector remains a hotbed of transaction activity, with news of the NSH acquisition by Surgery Partners coming just a few months after Optum announced it would acquire Surgical Care Affiliates (read our report on the acquisition and its possible implications here). Because activity in the ASC sector shows no signs of slowing down, PE interest in ASCs and surgery center companies is likely to remain high. New market investors would be wise to watch out for potential legal trapdoors.

Lab Services Market Remains Ripe For Private Equity

Posted in Healthcare Services Investing

In 2016 alone, the total U.S. clinical and diagnostic laboratory market generated approximately $80 billion in revenue, according to industry U.S. Securities and Exchange Commission filings. Just six years earlier in 2010, that market generated $55 billion in revenues. In light of the progressively aging population, as well as the ever-increasing influence of lab testing on clinical decision-making, there is no reason why the present growth in the market for laboratory services should plateau in the near future, and the laboratory market remains ripe for opportunity. …

To continue reading this Law360 column, co-written with my colleagues Paul Kiehl and Bart Walker, click here.

 

Healthcare & Life Sciences Private Equity Deal Tracker: TPG Growth Acquires Medical Solutions

Posted in Healthcare Services Investing

TPG has announced the acquisition of Medical Solutions by TPG’s middle market and growth equity platform TPG Growth.

Medical Solutions, based in Omaha, Neb., is a national provider of healthcare staffing solutions for hospitals.

TPG Growth is acquiring a majority stake in the company. Beecken Petty O’Keefe & Company, which acquired Medical Solutions in 2015, will retain an equity stake.

TPG Growth targets investments in a broad range of industries and geographies. The firm has more than $8 billion of assets under management.

The transaction is expected to close in the second quarter. Additional transaction terms were not disclosed.

Accolade Partners Closes Sixth Fund at $235 Million

Posted in Healthcare Services Investing

Accolade Partners has announced it has raised $235 million for its sixth fund, Accolade VI.

Accolade Partners, headquartered in Washington, D.C., and founded in 2000, is a venture capital and growth equity investment firm focused on healthcare and technology.

Investors of the oversubscribed Accolade VI include endowments, foundations and families.

The firm manages $1 billion of capital.

Healthcare & Life Sciences Private Equity Deal Tracker: Warburg Pincus to Acquire CityMD

Posted in Healthcare Services Investing

Warburg Pincus has announced it will acquire CityMD.

CityMD, founded in 2010, is an urgent care provider with more than 68 locations in the greater New York metropolitan area and Seattle.

Warburg Pincus, headquartered in New York, is a private equity firm that takes a long-term perspective and invest in businesses at all stages of development. It invests in healthcare and several other sectors.

The investment is intended to help accelerate CityMD’s expansion through new site openings and strategic acquisitions and partnerships.

Terms of the transaction were not disclosed.

Healthcare & Life Sciences Private Equity Deal Tracker: KKR to Acquire Angelica Corp.

Posted in Healthcare Services Investing

Angelica Corp. has announced it has entered into an asset purchase agreement with an affiliate of PE firm KKR.

KKR will acquire Angelica’s assets for approximately $125 million plus certain assumed liabilities. Angelica indicated it expects to continue operating as normal throughout the process.

Angelica, based in Alpharetta, Ga., is a provider of textile rental and linen management services to the U.S. healthcare market, specifically hospitals, long-term care facilities and outpatient medical practices.

KKR (Kohlberg Kravis Roberts) was founded in 1976. Its PE platform considers investments in healthcare and all other industries. Based in New York and publicly traded under the ticker symbol KKR, the firm prefers to invest in a range of debt and public equity investing and may co-invest, seeking a controlling ownership of a company or a strategic minority positions.

Learn more about KKR and other leading private equity firms that invest in healthcare by clicking here.

Shore Capital Partners Closed Second Private Equity Fund at $190 Million

Posted in Healthcare Services Investing

Shore Capital Partners has announced it has closed it second PE fund (Shore Capital Partners Fund II) at the hard cap of $190 million.

With the closing, the firm indicated it now has approximately $350 million in total capital under management.

Shore Capital Partners, based in Chicago, is a PE firm focused exclusively on microcap healthcare investments. Founded in 2009, Shore’s target investments range in size from $1 million to $7 million in EBITDA. Equity commitments range from $10 million to $30 million per platform.

The firm indicated Fund II will continue the first fund’s investment strategy of primarily investing in control buyouts.

Learn more about Shore and other leading PE firms that invest in healthcare by clicking here.

DW Healthcare Partners Closes Fourth Private Equity Fund at $295 Million

Posted in Healthcare Services Investing

DW Healthcare Partners has announced it has closed its fourth PE fund (Fund IV) totaling $295 million.

With the closing, the firm indicated it now has $800 million in total capital under management.

DW Healthcare Partners, with its U.S. office in Park City, Utah, is a PE firm focused exclusively on healthcare. Founded in 2002, DW prefers to make shareholder liquidity, management buyout and growth capital investments in mid-to-late-stage companies.

Fund IV currently has two platform investments: Edge Systems, a manufacturer of non-invasive equipment and consumables used in aesthetic skin health treatments, and PRIME Education, a provider of continuing medical education for the interprofessional healthcare team.