Spotlight on Healthcare – A Special Industry Report (Sixth of a Series)

So far in our healthcare series, we’ve shown a sampling of private equity and advisory perspectives. This week we get views from lenders in the sector.

One specialist was instructive. “Healthcare remains local,” she told us. “Florida, for example, is a very different market than the rest of the country. This makes it tough for national players to centralize. We start by analyzing systems to confirm our borrower is an operational leader with a strong clinical and administrative staff.”

What do you diligence to ensure that? “Nurses typically file medical data sets so the provider gets paid by the government,” she said. “If they’re good you’ll get paid what you’re supposed to be paid, otherwise you may leave money on the table. So the quality of information and the knowledge level of the staff is critically important...

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Quote of the Week

“It was a confluence of factors that…conspired to produce a move higher in yields.” – Christopher Sullivan, chief investment officer, United Nations Federal Credit Union.

Chart of the Week: Fever Pitch

Purchase price multiples for middle market buyouts in the healthcare have risen in the last four years.

Lead Left Spotlight

Bram Smith & Lee Shaiman

Outgoing and Incoming Executive Director

LSTA

"Despite the financial crisis and a sharp pricing drop, loans and CLOs actually performed as promised."

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Rob Morris

Founder and Managing Partner

Olympus Partners

"It’s not just about having a good IRR. It’s about how we handle risk."

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Brad Raymond

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"Private equity is an important driver of activity and has become a meaningful alternative to going public."

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Upcoming Interview: Andrew Welch

Managing Director

Revelstoke Capital Partners

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Upcoming Interview: Rod Rivera & David Baker

Managing Directors

Capstone Headwaters

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