Advent-backed ATI, BC Partners’ Cyxtera unveil SPAC mergers, MidOcean’s The Planet Group and VC-backed Applitools evaluate sales

It's raining SPAC mergers and MidOcean preps sale of Planet Group.

Morning, hubsters!

We’ve got a couple new processes to watch in software testing and high-end staffing services. But first, merger Monday is dominated with some notable SPAC news.

An Advent International-owned physical therapy giant that sources have long touted as a perfect public market candidate is coming to fruition. ATI Physical Therapy has agreed to merge with Fortress Value Acquisition Corp. with plans to ultimately list on the NYSE. The transaction values ATI at a $2.5 billion enterprise value – or 14x 2022 estimated adjust EBITDA. Up to $645 million in proceeds, including a fully committed PIPE of $300 million, are anticipated.

Advent, close to five years into its investment, said it would remain 100 percent invested, rolling approximately $1.3 billion of holdings into the new entity, while GCM Grosvenor will remain a significant investor.

The move looks to be an obvious one for ATI’s next phase of growth. The company encompasses 900 physical therapy clinics across 25 states and has grown its clinic footprint by 50 percent since 2016, according to Monday’s announcement. Sources have in the past told me ATI is bigger and growing faster than its publicly traded peer, U.S. Physical Therapy – with 550-plus locations today. Further, USPH trades at a robust multiple on the public markets that pales in comparison to where physical therapy assets have traded in the private market.

That’s not the only big SPAC deal this morning. Cyxtera, owned by BC Partners and Medina Capital, has agreed to merge with Starboard Value Acquisition Corp. at an enterprise value of approximately $3.4 billion. The transaction will create the third-largest publicly held global provider of retail colocation and interconnection services, with 61 data centers in 29 markets around the world.

Up for sale: Three years into its investment, MidOcean Partners is preparing for a sale of The Planet Group, a sizable staffing agency for the life sciences industry and other highly skilled markets, PE Hub has learned. Half or more of the company is focused on the healthcare market, and interestingly, it also operates a contract research organization within its life sciences division, sources said.

Read my story for details of the process.

Elsewhere, VC-backed software testing provider Applitools is up for sale, sources familiar with the process told PE Hub. Although Applitools is likely to be too small to make a new PE platform, the company is expected to generate interest among PE firms seeking add-ons to DevOps and software portfolio businesses, the sources said.

Read Milana Vinn’s full report on PE Hub.

That’s it for today! Have a great week, readers, and as always, write to me with feedback, tips and gossip or whatever at springle@buyoutsinsider.com.