PE Deals

Housatonic’s Aegis, California opioid-treatment group, seeks buyer

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Housatonic Partners, Aegis Treatment Centers, opioid, addiction, healthcare, private equity, merger, M&A
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  • Company likely to fetch similar deal metrics to BHG
  • Housatonic investment dates to 2014
  • Also on the market: Revelstoke’s Crossroads

Housatonic Partners is exploring the sale of Aegis Treatment Centers, the California provider of medication-assisted treatment for opioid addiction, according to four sources familiar with the matter.

Piper Jaffray is providing financial advice to the Canoga Park, California, company, the sources said.

Aegis posts Ebitda of about $20 million, they said.

While the process is in its early stages, Aegis ought to command deal metrics similar to Behavioral Health Group, two of the people speculated. Frontenac in December sold BHG to Vistria Group following a Piper-run auction.

Terms weren’t disclosed, but a source previously told Buyouts the transaction commanded a multiple of Ebitda a little north of 10x, or upward of $250 million.

More specifically, the deal was valued at some $295 million, or an Ebitda multiple approaching 12x, a separate source has since told Buyouts.

Led by CEO Alex Dodd, Aegis operates 32 opioid-treatment clinics throughout California. Aegis provides medication-assisted treatment using buprenorphine and methadone. Treatment is typically paid for by Medi-Cal, California’s Medicaid program, or private insurance.

The private equity community has proven eager to invest in providers looking to participate in tackling the nation’s opioid crisis.

In line with that trend, Aegis thus far is understood to have garnered strong interest from the sponsor community, with first round-bids submitted in February, according to two of the people.

The provider’s California concentration may hurt a little, one of these people and a third cautioned.

In other sector activity, Revelstoke Capital Partners is evaluating the sale of Crossroads Treatment Centers via Harris Williams, Buyouts previously reported.

The industry giant, Webster Capital-owned BayMark Health Services, is also expected to come to market in the second half, Buyouts reported. Goldman Sachs has been hired to advise BayMark, whose network spans close to 170 locations nationwide.

Housatonic, with offices in San Francisco and Boston, invested in Aegis in 2014. The firm typically provides equity of $10 million to $50 million for growth, minority recapitalization and buyout transactions.

Representatives of Houstanoic, Aegis and Piper Jaffray did not return requests for comment.

Action Item: Reach Housatonic’s Boston office at +1 617-399-9200.