OEP adds staffing specialist Prime Time Healthcare to portfolio

‘We’ve been looking at healthcare staffing for some time because the fundamentals suggest that staffing companies will be an increasing part of the healthcare labor ecosystem,’ said OEP’s Charlie Cole.

One Equity Partners will announce later this morning that the New York-based firm has acquired Prime Time Healthcare, a healthcare staffing services provider. Financial terms of the deal were not disclosed. 

Founded in 2012, Prime Time Healthcare is a provider of contract-based healthcare professionals nationwide. Headquartered in Omaha, Nebraska, the company specializes in the placement of RNs, LPNs, CNAs, and assorted therapy practitioners and professionals in facilities across all 50 states.

According to Charlie Cole, principal at OEP, the firm believes this asset has the opportunity to be a consolidator and also believes healthcare staffing is “highly fragmented,” a characteristic of many OEP targets.

“We’ve been looking at healthcare staffing for some time because the fundamentals suggest that staffing companies will be an increasing part of the healthcare labor ecosystem,” explained Cole in an exclusive interview with PE Hub. “The pandemic exacerbated existing clinician shortages, and we don’t see those easing anytime soon. Take nursing – estimates suggest the US could be at an RN deficit of almost 500,000 by 2025. Moreover, shortages are not nursing-specific.”

He also noted that demand for temporary resources is increasing across all segments of the healthcare staffing market.

“We also believe that the younger segment of the clinician population has more favorable attitudes towards travel and long-term temporary assignment than the general clinician population has had in the past. These dynamics all bode well for Prime Time,” he said.

When asked what the strategic growth plan is for the asset, Cole said that since the company provides, primarily, travel nursing, he sees an opportunity to broaden the company’s service offerings.

“For example, we believe that international nursing is a large opportunity and would fit well within our business, so international is clearly an area to target,” he said. “Ultimately, we think scale matters because the larger you are the more important you are to clinicians, as you are able to offer them a larger set of employment opportunities, and to providers, as you are better able to staff opportunities. So, a large part of our focus will be about using complementary acquisitions to create scale.”

PE Hub also had an exclusive interview with OEP senior managing director Greg Belinfanti and asked about the challenges that come with public market volatility, inflation and issues with buyers and sellers agreeing on pricing and valuations.

“While it’s true that given the shifting equity market sentiment there is a larger disconnect between buyers’ and sellers’ expectations, it hasn’t really affected OEP’s opportunity set as we’ve always been focused on partnering with founders and management; thus, we’re not really buying so much as we are helping ambitious managers grow and transform their businesses,” said Belinfanti. “Our pipeline is as strong as it’s ever been across sectors. For example, at Prime Time, management will continue to own a large minority stake in the company.”

He said that the biggest change in the deal landscape is the availability and cost of debt financing.

“That is going to impact valuations for a lot of PE buyers,” he said. “Historically OEP hasn’t used a lot of leverage so this will not impact us nearly as much. For example, our current fund is levered at less than 3.5x.”

“We are able to execute on these deals because we are focused on partnering instead of buying and calling on companies with immediate and actionable M&A opportunities to help our partners transform their businesses,” said Belinfanti.