Sorenson Capital-backed TruHearing hits the market

  • Sale to strategic buyer deemed more likely
  • TruHearing, health plans partner to provide low-priced hearing aids
  • Sorenson invested in TruHearing in 2012

TruHearing, the Sorenson Capital-backed hearing-aid-benefit manager, is on the auction block, five sources said.

TripleTree is conducting the sales process for TruHearing, the sources said.

Sorenson’s minority investment in TruHearing dates to December 2012.

TruHearing works with health insurers, including Medicare Advantage plans, to provide lower-priced hearing aids to associated members. The company says more than 100 million people have access to discount hearing aids because its health plan offers them TruHearing.

TruHearing was founded in 2002 by its former CEO, Lindsay Atwood. Tommy Macdonald was named CEO in November 2013, departing from Sorenson Capital shortly after the firm backed TruHearing.

The company generates Ebitda of about $15 million, one source said, while another source put the figure at about $12 million to $13 million.

The Draper, Utah, company is said to have drawn significant interest, particularly from strategic buyers, sources said. One source noted there’s speculation of a possible sale to a maker of hearing products. Such a transaction would be a logical vertical-integration play, the source said, likening it to Cardinal Health owning retail pharmacies.

Non-healthcare-type players are driving a more competitive process, added another source.

Sponsors, too, have expressed a growing interest in companies operating in the managed-care space, amid a shift to value-based care from the traditional fee-for-service reimbursement model.

Sorenson’s associated TruHearing investment team includes Luke Sorenson and Brady Broadbent.

The growth-focused PE firm has offices in Palo Alto, California, and Lehi, Utah.

Sorenson was launched in 2002 by a group of former Bain Capital investment professionals and former executives. That includes Fraser Bullock, a founding partner of Bain Capital and COO of the 2002 Olympic Winter Games.

The firm set out to raise a $100 million venture fund last year.

Representatives of TruHearing, Sorenson and TripleTree didn’t immediately respond to requests for comment.

The Wall Street Journal earlier reported that TruHearing retained TripleTree to explore a sale.

Action Item: Get in touch with Luke Sorenson at lsorenson@sorensoncap.com

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