Clearlake’s Symplr returns to market, all options on the table

Three banks advise the healthcare-focused GRC software company, which is expected to command a more-than $4bn valuation in a potential transaction.

Clearlake Capital Group is exploring strategic alternatives for Symplr, a healthcare-specific governance, risk and compliance software company that has scaled immensely under the Santa Monica firm’s backing, according to people familiar with the process.

A process recently kicked off with first-round bids coming up in a couple of weeks, the people said.

Evercore, Goldman Sachs and William Blair are providing sell-side financial advice. The latter two were involved in a 2020 process, which considered a minority stake sale or 50-50 joint ownership transaction that would bring in another private equity group, PE Hub wrote. That process was ultimately put on pause. 

This time around, all options are on the table, including a partial stake sale or complete exit, sources told PE Hub. Clearlake, for its part, has a history of partnering on its transactions. 

Symplr is projecting $190 million in 2021 EBITDA, sources said, with expectations a transaction will command an EBITDA multiple well into the 20x range, or north of $4 billion. Symplr is “great business” with clean financials, one source commented. 

As the numbers reflect, Symplr has grown significantly under Clearlake’s less than three years of backing. Clearlake’s October 2018 deal for the business, which brought in SkyKnight Capital as a minority investor, was valued at about $550 million, PE Hub wrote at the time. Last year when it ran a process, an $80 million EBITDA figure was cited by sources.

The company has built a robust healthcare-focused governance, risk & compliance (GRC) and operations portfolio, offering data management, workforce and talent management, vendor and visitor management, contract management, spend management, compliance, quality, and patient safety. Its SaaS solutions address healthcare labor and supply chain regulatory requirements, which have been of increasing focus through the pandemic. Its tech ultimately aims to improve efficiency, better outcomes, and safer patients. 

Fueling growth, Symplr has been on an M&A tear over the last several years, emerging a major participant in the consolidation of healthcare’s GRC industry.

The company’s May acquisition of HealthSource HR from Francisco Partners – through which it extended its talent management offerings – marked its 12th buy over the last six years and seventh since Clearlake and SkyKnight invested. 

In other meaningful acquisitions, the PE-backed platform bought Arsenal Capital’s TractManager last year in a more than $500 million transaction, sources familiar with the deal told PE Hub. TractManager encompasses three business units: strategic sourcing, contract lifecycle management and provider management. 

Clearlake, Goldman and Evercore declined to comment. SkyKnight and William Blair did not return PE Hub’s requests for comment.