Wellspring clinches third home care deal with Caring Brands, H&F and EQT jointly bid for Zooplus, VSS makes 3x-plus on Coretelligent

Happy Monday, hubsters!

One repeat investor in and around healthcare in the home is back for more.
Wellspring Capital Management has acquired Caring Brands, concluding a Lincoln International sale process for the franchisor of home healthcare across the US, UK and Ireland, and Australia, according to people familiar with the matter.

For seller Levine Leichtman, Caring Brands is its second exit of a home care franchisor, having unloaded its investment in Senior Helpers in 2016 through a sale to Altaris Capital Partners.

Besides the international scale of Caring Brands, the company is unique in that it offers the entire continuum of care at home: skilled nursing, home health, assistance with daily living activities, end-of-life hospice care and healthcare staffing. Most scale players are more limited in focus.

Caring Brands is the third new healthcare platform for Wellspring this year (following Pentec Health and HealthPRO Heritage), as well as its third deal to date in home care. Home health has long been the preferred setting of care for patients, but this trend has witnessed accelerating adoption and investor excitement through the pandemic.

Wellspring for its part has long been a supporter of home care, first backing hospice and home health business Great Lakes Caring in May 2014. More recently, it sold a majority stake in nonmedical home care company Help at Home to Centerbridge Partners and Vistria Group at an approximately $1.4 billion enterprise value, PE Hub wrote.

For financials and more on Caring Brands, check out my full report.

Compromise: Two private equity giants intent on investing in the popular pet products industry are no longer competing against one another, but have joined hands with an increased offer for Germany’s Zooplus.

Hellman & Friedman and EQT launched an increased and final offer for Zooplus of 480 euros per share. The deal values the German pet food retailer at 3.7 billion euros ($4.3 billion).

The bid translates to an 85 percent premium over the asset’s three-month volume weighted average share price before an initial bid was made public on August 13. Read more on PE Hub.

As an investor in European veterinary care giant IVC Evidencia, EQT knows the pet industry well. IVC recently scored an additional aggregate investment of €3.5 billion ($3.62 billion) — adding Silver Lake as an investor — that assigned the company an enterprise value of approximately €12.3 billion.

But the deal is unique in another way for EQT. The global investor is the majority owner in nearly every transaction it pursues (there are exceptions), but this time around it would become a jointly controlling partner with equal governance rights alongside H&F.

A couple reasons the firm strays from joint control, EQT partner Eric Liu told me earlier this year: EQT has a unique corporate governance approach (with boards majority-comprised of independent executives), while at the same time, a lot of the larger investors that invest in EQT funds do so because they want access to co-invest.

With the pet opportunity so vast and growing through the pandemic, and already one proven out investment in the space (IVC), it appears that EQT found justification for an exception.

Return: VSS Capital Partners generated 3x to 4x its money with its majority sale of Coretelligent, after growing the cybersecurity specialist organically and through M&A during its five-year hold, a source familiar with the deal told PE Hub.

Headquartered in Westwood, Massachusetts, Coretelligent provides comprehensive managed and co-managed white glove IT support, cybersecurity, back-up and disaster recovery as well as cloud services.

Under VSS’s five-year investment, Coretelligent grew EBITDA more than 150 percent, from roughly $4 million to close to $12 million, the source said.

VSS, remaining a minority investor, will look to ride the company’s continued momentum: “We think the company has terrific prospects going forward, and there is a chance to even further accelerate growth given the add-on acquisition potential,” said Trent Hickman, managing director at VSS. Read more on PE Hub.

That’s it for me! Have a great week ahead, and as always, write to me at springle@buyoutsinsider.com with any tips, comments or just to say hello!