I recently got the chance to interview Fazle Husain, head of US Healthcare at CVC Capital Partners, on the heels of the firm’s new investment in MedRisk, which manages the physical therapy claims process and coordinates care for injured workers.
MedRisk has a lot going for it, Husain said: A vastly untapped market opportunity, track record of growth, M&A possibilities and the future rebuilding of the nation’s infrastructure.
With this backdrop outweighing any covid impact to the business, CVC, runner-up in the company’s 2017 sale process, ran hard at the opportunity to invest behind Carlyle Group-backed MedRisk. CVC has a little more than 50 percent economic ownership although governance is split, a source familiar with the deal said.
“We think the secular trends around more infrastructure spending are really going to be pretty incredible,” Husain said. “We don’t have to get into the ‘Roaring Twenties’ to make this very exciting, but there is a view that post-pandemic there could be as much as a decade of increased spending in some of those areas in the US, which would create some strong tailwinds for MedRisk.”
Husain explained that “those are the types of projects that often result in increased workers compensation claims.”
In for the long hold, Carlyle about three years into its investment has produced a close to 3x MOIC, including the equity rolled over, the source familiar with the deal said.
Another key component of the MedRisk playbook will be M&A, and CVC is already fielding inbounds on this strategy. Read my full report on PE Hub for more insights from Husain and additional financials.
Next up: In the lower-middle-market, Stone Point Capital is preparing to sell Grace Hill, a talent management technology provider for the real estate industry, sources familiar with the matter told PE Hub.
The Greenwich, Connecticut, PE firm acquired a majority interest in the company in March 2018 and has since grown Grace Hill through multiple add-ons. Read Milana Vinn’s full report here.
New platform: Wind Point Partners plans to build out recently acquired FoodScience Corporation by expanding the nutritional supplement company’s channel partner network among other organic growth strategies, PE Hub’s Karishma Vanjani writes.
The company is poised to benefit from Wind Point’s experience with similar multi-brand companies, having previously invested in Pestell Group. Chicago-based Wind Point will focus on developing FoodScience across multiple channels such as Amazon and Chewy. “We will certainly be allocating resources,” the firm’s Paul Peterson said, “but not exclusively to these platforms; there are opportunities in other channels as well.” Read it here.
That’s it for me today! Have a great week, readers, and as always, hit me up with feedback, tips and gossip at firstname.lastname@example.org!