KKR and Veritas support 2018’s largest healthcare PE deals

  • Largest LBO: KKR’s $9.9 bln deal for Envision
  • Largest carveout: KKR’s $2.4 bln carveout of AMR from Envision
  • Largest secondary buyout: TPG, WCAS, Humana’s $1.4 bln buy for THL’s Curo Health

Private equity continued to fuel billions of dollars of healthcare deal flow in 2018, with KKR, Veritas Capital and TPG behind some of the year’s most sizable trades.

AthenaHealth may have dominated headlines, but the biggest check went to physician-outsourcing giant Envision. KKR, continuing on its healthcare tear, claimed control of Envision in a $9.9 billion take-private, concluding a highly anticipated process that the company said involved outreach to 25 potential buyers.

Quality assets of scale are tough to come by, but an elevated price environment didn’t deter sponsors looking to boost their healthcare exposure in 2018. Sponsors emphasized creativity to navigate the froth, with many of the year’s biggest bets coming in the form of partnership transactions, corporate carveouts and add-ons.

For example, also on PitchBook’s top 10 list of PE investments in U.S. healthcare companies: KKR’s $2.4 billion carveout of American Medical Response from Envision — which, as the year’s largest corporate divestiture, was done before the public company itself opted to be acquired by the buyout firm.

In other categories, the largest add-on was a $5.6 billion deal involving hospital operator LifePoint Health. Elsewhere, a consortium that included a pair of investors and health insurance giant Humana struck 2018’s largest secondary buyout through a $1.4 billion deal for hospice-services provider Curo Health Services.

Here’s PitchBook’s top 10 list (through Dec. 20):

1. KKR’s $9.9 billion take-private of Envision Healthcare

2. Veritas Capital and Elliott Management’s $5.7 billion take-private for electronic healthcare company Athenahealth

3. Apollo’s $5.6 billion acquisition of LifePoint Health through RCCH Healthcare Partners

4. Humana, TPG Capital and Welsh, Carson, Anderson & Stowe’s $4.1 billion purchase of Kindred Healthcare

5. KKR’s $2.4 billion carveout of American Medical Response from Envision

6. Summit Partners and OptumHealth’s joint $2.15 billion purchase of Sound Inpatient Physicians from Fresenius Medical Care

7. Platinum Equity’s $2.1 billion buy of Lifescan, a provider of blood glucose monitoring products, from Johnson & Johnson

8. Humana, TPG and WCAS’s acquisition of Thomas H. Lee’s Curo Health for $1.4 billion

9. Altamont Partners’ $1.2 billion leveraged buyout of Juice Plus, a provider of plant-based nutritional supplements

10. Altaris Capital Partners’ $1.1 billion take-private of medical imaging company Analogic

PitchBook Runner Ups

  • Veritas’s acquisition of GE’s healthcare IT unit for $1.025 billion
  • Investor AB-backed Patricia Industries’ acquisition of Sarnova for $903 million
  • TPG’s $737 million take-private of Exactech
  • Blue Wolf Capital Partners and Kelso’s $700 million acquisition of Jordan Health from Palladium Equity
  • Madison Dearborn Partners’ $675 million deal for Ares Capital’s Alcami