ArchiMed invests in RehabWorks, Primo Group

ArchiMed has acquired a majority control of RehabWorks as well as a minority stake in Primo Group s.r.l. Financial terms weren’t announced. U.K.-based RehabWorks is contracted by companies and insurers to manage therapy, rehabilitation, workforce reinsertion and other physical and mental health issues for employees. Primo, of Torino, Italy, operates retail dental clinics in that country.


September 21, 2015 – ArchiMed, Europe’s first independent private equity healthcare specialist, acquired majority control of RehabWorks and a large minority stake in Primo this month.


Though the transactions are in different countries and healthcare subsectors, they share similar characteristics. Both Primo and RehabWorks are leaders by size and service quality in fragmented healthcare sectors ripe for consolidation.


Primo was founded in 2010, only two years after Italy’s government authorized the creation of dental clinic chains. In a marketplace where such clinics still account for only 5 percent of dental practices, Primo’s profits are growing at a double-digit annual rate, while revenues grew almost 50 percent in the most recent fiscal year.


“We will leverage ArchiMed’s Healthcare Network of financial and operational specialists to support Primo’s innovative management team as it expands throughout Italy,” says Vincent Guillaumot, a Managing Partner of ArchiMed.


Primo uses economies-of-scale to offer attractive long-term contracts to exceptional dentists in central high-street locations in Italy, resulting in unusually high return on investments for new stores and above-average customer retention rates.


Similar economies are key to RehabWorks’ business model as an integrated provider of health, injury and rehabilitation management services for companies and insurers. Critical to the appeal of the RehabWorks transaction, was ArchiMed’s ability to source and finance RehabWorks’ simultaneous carve-out purchase of Right Corecare from human resource provider ManpowerGroup. Right Corecare offers mental health counseling as well as “critical incident” support to companies and their employees. RehabWorks focuses on making employees healthier and happier, improving productivity and job attendance.


“The Right Corecare transaction completes RehabWorks’ premium occupational health offering, turning the group into an ideal competitive platform in a fast-growing sector where most rivals offer partial services or outsource to cover the gaps,” says Robin Filmer-Wilson, a Managing Partner of ArchiMed.


The metrics that make both the Primo and RehabWorks acquisitions attractive are complemented by ArchiMed’s substantial balance sheet and its network of connections throughout the European Healthcare industry, both of which will be used for further acquisitions in each group’s subsector.


No debt was used in either transaction and both were the result of proprietary processes. Senior managers of RehabWorks and Right Corecare reinvested all proceeds from the deal into the expanded group, demonstrating their faith in ArchiMed’s plans. ArchiMed’s interests are also fully aligned with Primo’s management team.


About ArchiMed – Founded by Managing Partners Denis Ribon, former Global Head of Healthcare at 3i – one of the world’s largest private equity firms – and Vincent Guillaumot, also a former 3i Healthcare executive, along with several colleagues, ArchiMed is the first independent private equity team 100 percent dedicated to the healthcare sector in Europe. The firm’s inaugural Med 1 fund surpassed its €120 million target, closing on its hard cap of €150 million in June, 2015. Senior management also includes Managing Partner Robin Filmer-Wilson, a former Investment Manager at Universities Superannuation Scheme, Operating Partner Loic Kubitza, previously a Leader at PricewaterhouseCoopers’ Healthcare and Life Sciences Practice, and Operating Partner Christoph Böhmer, previously Managing Director of €1 billion-in-revenues cardiovascular leader Biotronik. In the last fifteen years, the ArchiMed team has invested more than €1 billion in 20-plus companies, achieving a total return of over 2.6 times invested capital.