Health Bay Group

Sale of healthcare practice with 4 branches and employing c.30 doctors to a regional healthcare provider backed by private equity.


Plan

The business had grown rapidly and gained market share through organic expansion, and was in a critical stage in its development. As a consequence of its success, it faced increasing competition and external market forces.

The shareholders were looking for solutions to continue growth and consolidate its market position but at the same time, monetising the value they had created in the business to date.

They were also seeking both financial and human capital for identified organic expansion opportunities inherent within their existing growth plan, while also wishing to retain the potential value implied by this future growth.

We planned a 70% sale to PE of the existing business with a reinvestment commitment with a capped limit on reinvestment of the proceeds under a subsequent joint venture funding commitment for day surgery and diagnostic centres.


Model

We modelled the peak funding requirements, sensitivities and investor return metrics to optimise the risk return balance between management and investors to ensure that the rewards/returns of the venture would largely be dependent on the performance of the management team, as opposed to the absolute percentages of funding injected.


Market

Structured, documented and presented the proposition to PE clearly articulating the significant value in the current business as a key division of the buyer.

As part of the transaction, we obtained binding commitments for the funding of the future organic growth plan of the existing shareholders enhancing both buyer and seller upsides upon the simultaneous exit by the PE and existing management.


Close

We facilitated the due diligence, we ensured that all points raised by buyer were responded to in a timely and structured release. We managed the buyer through a tight but realistic timeframe. We commercially reviewed of all structural and legal documentation including SPA, shareholders agreement (which governed the basis of the agreement post-transaction), the management compensation agreement and the joint venture funding and capital agreements.

(Closed February 2015)

“Partnering with Anglo Arabian Healthcare has been an exciting milestone for us. With our combined clinical and management expertise we aim to become one of the strongest healthcare providers in the region and have a range of expansion plans, including opening world class facilities and introducing cutting edge medical services.” – Dr Kamal Akkach, CEO and Founder of the Health Bay Group.