Digging into KKR’s $1.2b-plus deal for Lightyear’s Therapy Brands, Another big LBO opportunity emerges in Medline Industries

Behind KKR's $1.25 billion Therapy Brands' buyout and Medline Industries is exploring a sale that could value it as much as $30 billion.


With the continued de-stigmatization of the behavioral healthcare industry and more individuals seeking mental health services coming out of the pandemic, the need for technology solutions only grows as practices expand and add practitioners.

That’s where companies like Therapy Brands come in. ICYMI, Therapy Brands late last week scored a new majority owner in KKR, with Lightyear Capital marking its second major exit at the intersection of healthcare and tech-enabled financial services.

The deal values Therapy Brands at $1.25 billion, sources familiar with the matter told PE Hub – translating to a 2021 EBITDA multiple of approximately 25x. Read my full report on PE Hub.

Under Lightyear, whose roots lie in payments and insurance, Therapy Brands tripled in size, while its payments penetration doubled overall, a source familiar with the company said.

The financial services specialist’s first investment in healthcare-related financial services was Alegeus, a consumer-directed healthcare payment and processing firm. After buying the business in 2012 for $335 million as a carveout from Fidelity National Information Services, it sold Alegeus to Vista Equity Partners through a deal that sources said valued the business somewhere between $750 million and $900 million, PE Hub wrote.

$30b opportunity: Another sizable LBO opportunity may be on the table.
Medline Industries is exploring a sale that could value the big medical-supply company at as much as $30 billion, according to a Wall Street Journal report. The report said Medline is likely to attract private-equity bidders, partly because industry players could struggle to swallow such a big rival.

This report comes as amid recent noise around another possible scale take-private scenario, with Toshiba confirming last week reports that it had received an inbound offer from CVC Capital Partners. The Nikkei was the first to report on the proposal, writing that CVC is evaluating more than $20 billion deal, which would represent a 30 percent premium over the Japanese industrial group’s share price.

With emergence of large-scale LBO talks, public-company carve-out situations continue to brew. That includes Bausch + Lomb – whose activist-pressured parent company announced last year it planned to spin off the iconic eye-health business. PE Hub wrote in early March that a targeted sale process encompassing private equity groups was underway, with indications of interest due early April.

That’s all for me! Have a great week ahead, everybody, and in the meantime, hit me up at springle@buyoutsinsider.com with any feedback, tips or just to say hello!