Mainsail Accepts Kindred Approach
The San Francisco private equity firm hired Cain Brothers to shop its home hospice business.
August 11, 2011
Kindred Healthcare Inc. agreed to buy a Mainsail Partners portfolio company for $51 million.
The transaction, announced Thursday, has the Louisville, Ken.-based hospital and nursing facility operator targeting Professional HealthCare LLC, which Mainsail had formed in 2006.
Professional tapped Matt Margulies of Cain Brothers & Co. LLC to shop the company. Houlihan Lokey advised Kindred. Inquiries to each company were not returned.
The transaction, expected to close by the end of the third quarter, is subject to several regulatory approvals and other conditions. Should the deal be completed, Kindred expects that it will be slightly accretive to its 2012 earnings.
During its five years with Mainsail, Professional received a slate of new managers and recognized an increase in annual revenue by nearly four times. With operations in 27 locations, including California, Arizona, Nevada and Utah, the home health and hospice service generates revenue of roughly $53 million per year. That includes three consecutive years of revenue and profit margin increases.
San Francisco-based Mainstay also negotiated and secured a $10 million credit facility to expand the company and created a corporate development program which resulted in numerous bolt-on acquisitions including Victorian Home Health, Haven Home Health LLC, and Home Health Services, expanding its coverage into Utah, Nevada and Arizona.
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