Oras Medical

Sale of owner managed Doctors’ practice to a regional healthcare provider backed by private equity and subsequent joint venture funding commitment for IVF centres.


Plan

The shareholder wanted to realise some of the cash through a partial sale but wanted to have control of the business in terms of patients, treatments etc. We looked at a private equity portfolio company in the sector, which had plans to expand in the sector. We structured an appropriate deal structure in terms of continuing in the business, realising some cash and getting financial backing to expand.


Model

Through valuing the business with market benchmarks, it became evident that one of the key issues was the key-man risk. Therefore, we modelled various scenarios to look an optimum sale while retaining further upside in the business for the existing shareholder through a secondary exit with a put-call option mechanism five years following the sale.


Market

We held discussions and presented the proposition to the private equity, clearly articulating not just the value in the current business but the future growth through scaling the brand while at the same time providing a retention mechanism of key management and at the same time providing a viable secondary exit. This aligned with the private equity’s eventual exit plan.


Close

Following the facilitation of 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, with a commercial review 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 put-call mechanism.

(Closed: November 2014)

“I tremendously appreciate what you have done and what you have contributed. I’m very thankful and grateful for everything. Thank you.” – Dr. Oras