PE Deals

WindRose-backed myNEXUS taps adviser for sale

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Centers for Medicare & Medicaid Services, healthcare, private equity, Medicare, Medicaid
  • Tennessee company founded by ex-SunCrest execs
  • WindRose, formerly MTS Health Investors, backed myNEXUS in October 2014
  • myNEXUS partners with payers to curb post-acute care costs

MyNEXUS, which works with payers to help coordinate and rein in the costs of home care, is gearing up for a sales process, four people familiar with the matter said.

The WindRose Health Investors-backed company has retained UBS for financial advice, the people said.

A sponsor-focused sales process is anticipated to formally launch this fall, they said.

MyNEXUS, Brentwood, Tennessee, is on track to produce run-rate Ebitda in Q1 2019 of some $60 million, one of the people said.

MyNEXUS offers care and benefits management services to payers providing home-care services, remote-monitoring services and preventative health recommendations.

Insurer partners include Anthem and Humana, the company’s website shows.

The company was founded in 2014 by former executives of home-care and hospice company SunCrest Healthcare (now part of Almost Family) — McArthur VanOsdale and John W. “Wally” Dant — who serve as CEO and executive chairman of myNEXUS, respectively.

The management team is interested in staying with the company post-transaction, one of the people said.

WindRose, formerly MTS Health Investors, completed its majority investment in myNEXUS in October 2014 through MTS Health Investors III LP. VanOsdale and Dant rolled over significant ownership stakes, an announcement at the time said.

Former U.S. Senate Majority Leader Bill Frist joined myNEXUS’s board in February.

The auction for myNEXUS comes on the heels of Clayton, Dubilier & Rice’s partnership transaction for Cardinal Health’s highly sought-after naviHealth, which offers similar services to myNEXUS.

Terms of the deal weren’t disclosed, but CD&R’s purchase of a 55 percent stake in naviHealth valued the company at about $1.2 billion, sources told Buyouts.

While the naviHealth process will target the PE community, health-benefits managers including Summit Partners’ CareCentrix and Express Scripts’ eviCore could also take interest, sources speculated.

CareCentrix last fall engaged UBS and Allen & Co to explore a sale, Reuters reported. The asset never traded.

In other notable sector activity, General Atlantic earlier this year made a strategic investment in Francisco Partners’ Landmark Health. The deal followed a Barclays-conducted sales process that sources have said drew tremendous interest.

WindRose manages more than $700 million and is investing out of its fourth fund.

The New York firm targets investments in healthcare-services companies ranging from $25 million to $300 million in enterprise value.

WindRose’s recent investment activity includes its September recapitalization of Kolmac Clinic, an East Coast-focused outpatient addiction-treatment company.

In July, it recapitalized basys, which provides benefits-administration technology for the Taft-Hartley market in the Baltimore market.

Representatives of WindRose declined to comment, while those with myNEXUS and UBS couldn’t be reached on Friday.

Action Item: Read more about CD&R’s partnership deal for Cardinal Health’s naviHealth: https://bit.ly/2CYZrDh