Don't Plan to Fail....

Unfortunately, procrastination may be all too common among business owners... NOT a good trait for those considering selling.  The Exit Planning Institute (EPI) estimates that 4.5 million businesses will go to market over the next decade.  However, only 20 - 30% may actually be sold according to Christopher Snider, EPI CEO.  Recent surveys of business owners by EPI reveal that many have little to no exit planning in place. 

Platinum Financial Planning; jmarkmiller.net

Selling is not a snap decision nor will it happen in a snap...or, at all if you consider the input from EPI's Snider. It's a decision that requires ample thought...

Michael R. Lewis, a retired corporate executive and entrepreneur, suggests that owners consider some of the following questions before initiating the sale process. 

1. What will you do after the sale?
2. Can you replace the income from your business?
3. Does your business enjoy a healthy advantage in the marketplace?
4. Who are potential buyers?
5. What are possible obstacles to a sale?
6. Are you able to run the business and participate in the sale process?

Start the planning now... the experts suggest business owners start preparing for a sale 3-5 years from the desired exit date.  Conducting internal due diligence is one approach to assessing how prepared an owner is for the big event.  And, keep Ben Franklin's quote in mind... to spur you into action.

Investor Feels Good about Urgent Care

CityMD, the New York metro area urgent care provider, will soon go under the Warburg Pincus banner.  The private equity firm is planning to acquire a majority stake in the healthcare services provider.

Warburg's interest is understandable.  CityMD, founded by Dr. Richard Park in 2010, has experienced impressive growth.  Dr. Park grew the operation from a single clinic to 68 locations serving more than 1 million patients annually (through a merger and start-ups). CityMD has a heavy presence in the New York metro area - the City, Long Island, northern New Jersey.  Also, through a partnership with CHI Franciscan Health, CityMD operates clinics in Washington state.

With today's preference for convenience and as high-deductible health plan become more commonplace, patients will likely seek out urgent care centers to address certain health needs.  Many clinics have already expanded their service menu to appeal to patients. In fact, Becker's Hospital Review reports that "adults under age 30 are more likely to visit an urgent care center than a primary care physician."  Increased use of urgent care centers bodes well for the growth of the sector.

IVY Goes WEST

We're pleased to announce that West Physical Therapy is

now part of the growing Ivy Rehab family. 

Dave Franklin, Ivy's President of Midwest Operations, noted 

"West Physical Therapy is an excellent partner 

as we grow our footprint in the Midwest..."

Congratulations to our client and West PT owner, Julie West, and the staff in the Chicago area offices.

Are you Ready to Sell?

One of our clients paid us a compliment...and it MADE OUR DAY!

 “MT Consulting was instrumental in evaluating and packaging our business to create overall value.  Your ability to keep us focused, prepare us for due diligence, and lead us through the process was critical for us to have a successful transaction. This expertise resulted in a great deal, and great relationships moving forward..."   

  ~ Owners of a Large, Multi-site Service Business 

So, what helped to prepare our client for a smooth, successful transaction?  We believe it was our commitment and their buy-in to Seller Due Diligence.  

What is Seller Due Diligence?...  an outside analysis of a Seller’s financial and operational info conducted from a buyer’s perspective prior to marketing a business. (We're experts at performing seller due diligence. In fact, it's a core service provided for our clients.)

During the process, our goal is to verify the accuracy of key business data as well as uncover, correct and/or address any potential buyer concerns upfront.  Also, we often identify adjustments that positively impact business profit. In general, the transparency is appreciated by buyers and works to diffuse issues that could delay or derail a transaction.

Benefits of Seller Due Diligence

• Increased Buyer Confidence
• No Surprises during "buyer due diligence"
• Prepared & Well-packed Data for "buyer due diligence"
• Accelerated Closing
• Enhanced Offer

We’ve been involved in M&A for over 25 years – on the buyer and seller side.  While there are a number of factors that attract a buyer, buttoned-up and prepared sellers are likely to get the greatest attention and a better deal.  Reach out if You're Ready to Sell and would like to better position your business for the best deal. 

ADCS Increases Michigan Presence

ADCS (Advanced Dermatology and Cosmetic Surgery) increased its Midwest presence with another acquisition in Michigan. Oakland Dermatology Associates (Bloomfield Hills, MI) owned by Dr. Neldagae Chisa is now part of the ADCS family.  She has been providing patients with derm care for over 50 years. 

With the addition of Dr. Chisa's practice, ADCS now features 6 offices in the Detroit metro area.  The Florida-based platform derm practice was founded in 1989.  With numerous acquisitions over the last several years, the practice boasts 180 locations in 12 states. 

Related:
ADCS Focus on Michigan
A Win for Bernie..A Clinic for ADCS

Looking for a Sweet Deal?

If you're thinking of selling your business... the next step is a logical one - Plan.

Proactively addressing operational issues positions your business better among Buyers, e.g.: location & revenue growth, increased profit, clean financials, effective systems.  As well, a review of legal and tax issues ensures your interests are recognized and in order in the event of a sale.

Despite pre-sale due diligence, conditions emerge that may sour a deal.  Following are a few examples:

-Over Dependence on Owner:  Can your team effectively support a new owner to sustain & expand the business? Time to transition key client or vendor relationships to team members?

-Star Talent Departures: Consider using non-solicitation and/or non-compete agreements for key employees that can be transferred to the buyer.

-Going It Alone: Owners know how to run their business, sell-side advisors know how to negotiate the best terms and get to Closing. Relying on the expertise of your deal team will save you time, headaches and generate the sweetest return.

-No Growth Plan:  Buyers value and reward an owner's initiative in devising a plan for growth.  This may include an approach to a new geography, new services, new systems to enhance the bottom line.

-Cold Feet:  Selling is emotional so it's understandable when an owner has second thoughts but, it can be costly. To ease the transition - identify life's next step before you exit the business.

No time like the Present to get your business in order... whether a desired sale is close in or years away. Start the process with a business valuation.  It's an excellent tool and will likely reveal key areas to improve or tweak to ensure a Sale on Your Terms.

Goin' North

ABRY-backed Dermatology Associates headed north for its latest acquisition -Texoma Dermatology Clinic. The long established clinic, Texoma, offers dermatologic care in northern Texas and southern Oklahoma.  Clinics are located in Sherman and Paris, Texas.  >>Read more

Reference:
Dermatology Associates quick to pick up 5

Where are you headed this year?

A business valuation typically comes up for discussion when considering a sale.  However, the tool is valuable even if you're years away from selling.  The yearly assessment establishes your starting point.  Key decisions, direction, strategy refinement may follow in an effort to better manage and grow one's business.  Our latest newsletter also addresses the topic.  Take a look HERE.
If you need help with your 2017 valuation, we're here to help.  Call us at 610-527-8400.

NOT a Good Exit Strategy

Defense against cyber attacks critical.

An article in Axial Forum reports a worrisome statistic for business owners:

60% of small businesses are put out of business due to cyber attacks.  

The demise of the business typically results a short time (6 mos.) after the attack due to the financial burden of the clean up and reputational issues.  Average cost for clean up is $690K.  The article author, Gary Miller, outlines ways to be diligent against attack.  Read here

UnitedHealth Increases Footprint

UnitedHealth is expanding its healthcare provider footprint.  This week the healthcare giant announced that Optum, it's health services arm, will acquire Surgical Care Affiliates.  The new Optum company is a chain of outpatient surgery centers - 205 facilities across 30 states.  >>Read more

The addition continues a buying spree over the last few years which has included doctors groups, clinics and a leading urgent care provider, MedExpress.

Coincidentally, MT Consulting brokered MedExpress' first deal - when the provider had only 7 centers.  The deal set the wheels in motion...MedExpress has since substantially increased its presence in the Mid-Atlantic, Southeast and Midwest.  According to UnitedHealth, the MedExpress expansion will continue in 2017.

Healthcare M&A Expected to Increase

Freedman predicts strong Healthcare M&A

Jim Freedman of Intrepid Investment Bankers LLC, expects strong M&A activity in healthcare to continue.  In a November interview, he suggested that the level of industry investment and consolidation in 2016 coupled with the potential repeal of ACA should keep healthcare deal activity robust into 2017.

Freedman is President of the Los Angeles-based firm that provides M&A, capital raising and strategic advisory services to entrepreneurs and middle-market companies. Check out his interview here.

PT Moniker Changes

New day, new name for a number of PT practices across the country.   Check out the changes: 

ATI’s now on the door of IDEAL Physical Therapy locations in Arizona and Texas.   That’s also true for Triumph Physical Therapy’s four Southeast PA clinics.   

Ivy Rehab recently announced a partnership with The Orthopedic Institute of NewJersey.   As new owners, Ivy will manage three of their NJ physical therapy locations.  

Maryland Physical Therapy is now part of Pivot Physical Therapy’s network of 120+ locations.  The Glen Burnie, MD excels in work injury rehabilitation.

Another Acquisition for Aris

With the backing of Great Point Partners, Aris Radiology recently made its third strategic acquisition. The national radiology provider acquired US Teleradiology (UST) with reading centers in Atlanta and Tampa.  With the UST acquisition, Aris staff radiologists number over 250 who service over 400 client sites in 30+ states.

Carl Kozlowski, Aris President and CEO will continue to lead the expanded firm.  UST CEO, Francis Ferraro will transition to Aris' leadership team.

"This acquisition solidifies Aris’ position as one of the premier national radiology providers and a leader in the consolidation of the radiology market.”    

~Rohan Saikia, Principal, Great Point Partners

>>Read more

PSA HC Reaches Deeper in West & TX

PSA Healthcare, a national provider of pediatric home care services recently acquired Colorado-based Professional Pediatric Home Care (PPHC) from Bow River Capital Partners. 

PPHC complements the focus of its new parent… providing home-based nursing and therapies for medically fragile and/or special needs children.  Atlanta-based PSA extended its geographic presence with PPHC's 3 Colorado locations as well as the Houston area locations of Reach Pediatric Therapy (part of PPHC).

Based on demand, PSA Healthcare has extended its services over the years to also include adult home care services.

>>Read more

Remote Behavioral Health Brings the Doctor Home

Telepsychiatry is the newest entry into remote telehealth offerings by American Well.

The company, focused on transforming healthcare delivery, addresses basic health issues as well as chronic conditions.  American Well already serves 50 million covered Americans through its Amwell video app or work with major health insurers.

Why the move into remote behavioral health services?  It's logical when you consider the numbers.  According to Dr. Zereana Jess-Huff, American Well VP of Behavioral Health:

"Every year one in four people will deal with a mental health disorder, yet less than half of these individuals will actually receive treatment... "

The service launched in selected states the week of September 12th with nationwide coverage expected in early 2017.

Read more about American Well's move into behavioral health. 

ADCS Acquisitions Crisscross US

Courtesy of rgbstock.com

It was a busy summer for Florida-based Advanced Dermatology and Cosmetic Surgery.  Over the last few months, the firm added seven practices to its base of over 150 locations.  Some acquisitions strengthened ADCS market coverage and others established a new geographic presence.

Recent acquisitions include:
Cambio Dermatology -Gulf Coast, FL
Capital Dermatology -Greater DC
Denver Skin Clinic 
Philadelphia Institute of Dermatology
Dermatology Clinic, P.C. -Colorado Spgs, CO
Practice of Dr. Stiegel; Practice of Dr. Martone -Greater Pittsburgh, PA   

Dermatology Associates Quick to Pick up 5

It didn't take Dermatology Associates long...  Soon after ABRY's May acquisition, the derm practice management organization scooped up 5 Texas practices.  With ABRY's backing, Dermatology Associates appears ready & able to continue its expansion beyond its current footprint (Texas, Kansas, Missouri).

Newly acquired practices include:

• Highland Dermatology - Dallas, TX
• Southwest Cosmetic Dermatology Associates - Fort Worth, TX
• Skin and Laser Surgery Associates - Pasadena, TX (Houston area)
• Medical Arts Dermatology -Corsicana & Waxahachie, TX (Dallas area)
• Powell Dermatology - Sugar Land, TX (Houston area)

>>Read More

Schweiger Derm Group Expands

On the heels of an April investment by LLR Partners, the Schweiger Dermatology Group continues its expansion.  In May, New York City Mohs surgeon and skin cancer expert David Kreigel, M.D. and his staff from the Manhattan Center for Dermatology joined the derm platform business.  

Dr. Eric Schweiger owns and operates over 20 locations in the greater New York area. The newest Schweiger location is on Long Island with the acquisition of Dr. Frank Demento's practice mid-June. Schweiger Dermatology Group providers offer advanced treatments and accommodations for all medical dermatology concerns with a focus on customer service. >>Read more about the recent practice acquisitions of Dr. Kriegel and Dr. Demento.

Related:
Derm Platform Secures Funds to Grow

ATI Hits 150 in Illinois

ATI Physical Therapy added more Illinois locations recently with the acquisition of Atlas Physical Therapy and Sports Medicine Centers.  The early June acquisition includes four clinics in Chicago's western suburbs - not far from the ATI corporate office in Bolingbrook, IL.   ATI's Illinois total is now 150 with another company office set to open June 20 - also in the western suburbs.  >>Read more

"We are excited about our partnership with ATI and believe it will provide our organization with valuable resources, which will help us continue to provide the highest quality of care for patients throughout our communities..."

~Charles Clark, Atlas Director

                                                                        

ATI's Red Letter Occasion

With the acquisition of two physical therapy practices, Chicago-area based ATI Physical Therapy adds locations in 6 states.  From the heartland, Community Rehab Physical Therapy (Omaha-area HQ) and its 12 clinics now go under the ATI banner.  With the addition of California-based Adient Physical Therapy, ATI extends its reach deeper in the western U.S.  Adient's 7 clinics are located in Alaska, Arizona, Oregon and California.  

Dylan Bates, CEO of ATI Physical Therapy noted: 

"The addition of these two organizations is a red-letter occasion for ATI - strengthening our position in the Midwest and greatly expanding our services in the West..."

>>Read more