Cortec Group concluded its auction for for Cranial Technologies, selecting Beecken Petty O’Keefe & Co. as the winning suitor for the plagiocephaly-treatment provider.
The announcement confirms a May 3 Buyouts report that Cortec had chosen a Chicago private equity firm to acquire the maker of helmets that treat infants with flat-head syndrome.
Cain Brothers led the sales process for Cranial, while Raymond James & Associates co-advised.
The Tempe, Arizona, company’s run-rate EBITDA and revenue lie at roughly $12 million and $50 million, respectively, sources familiar with the matter say. The asset traded at a low-double-digit multiple of EBITDA, one source said, suggesting the transaction commanded a valuation north of $120 million.
The process encompassed both sponsors and strategics, including medical-device companies and multisite operators, one of the sources said.
Plagiocephaly is characterized by a flat spot or misshapen head caused by “pressure from everyday surfaces, such as beds or car seats,” the website says.
Cranial’s custom-made devices — the DOC Band — were the first cranial helmets cleared by the Food and Drug Administration to treat plagiocephaly. The DOC Band redirects a baby’s natural growth into a normal head shape.
Cranial was founded in 1986. Cortec bought Cranial from its founder in December 2011 through its 2006 vintage Cortec Fund IV. The Cortec investment team included Jeffrey Lipsitz, Jeffrey Shannon, Bill Tucker and Jack Miner.
For Beecken Petty, the transaction comes on the heels of its sale of travel-nurse-staffing firm Medical Solutions to TPG Growth.
Terms weren’t disclosed in the March 8 announcement, but the deal was valued at about $500 million, sources familiar with the matter said. Beecken Petty tapped Jefferies and Piper Jaffray to sell the company less than two years after completing its recap.
Action Item: Contact Cortec Managing Partner Jeffrey Lipsitz at firstname.lastname@example.org
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