Peak Rock Capital snags Paragon Healthcare

Austin private equity firm Peak Rock Capital has clinched a deal to buy Paragon Healthcare, a specialty infusion provider, according to four people familiar with the matter. 

The deal, expected to soon close, is valued between $250 million to $275 million, the people said. Plano, Texas-based Paragon’s trailing 12-month EBITDA sits north of $25 million, they said. 

The acquisition was equity backstopped, with no financing contingency, sources said.

Edgemont Partners and Guggenheim Partners advised Paragon on the sale. 

Founded in 2002, Paragon encompasses more than 35 infusion centers (IVCs), specialty pharmacies and support offices nationwide. The company focuses on infusible and injectable pharmacy services in alternate site settings. 

Led by CEO Rick Allen, Paragon has been growing at a more than 20 percent clip year-over-year, one of the people said. In fact, Paragon actually continued to grow through covid-19. Given that its pharmaceutical services are tailored to patients with chronic health conditions, demand for prescriptions have not subsided. 

The company just recently expanded with the addition of Oklahoma City’s Specialty Pharmacy – the first of 50-plus new Paragon locations scheduled to open in 13 different states nationwide by 2025, according to a recent press release. 

“The company will nearly triple its current workforce of 800+ employees with projections of serving 100,000+ patients annually within the next five years,” the release said.

For Peak Rock, the investment is consistent with its strategy of backing founder-led businesses.

The mid-market firm typically invests in companies with enterprise values ranging from $50 million to $750 million, deploying $30 million to $300 million in capital per investment. 

Peak Rock raked in $1.3 billion for its sophomore fund in January 2018, beating its $900 million target.

Action Item: Check out Peak Rock’s latest Form ADV