Private equity firm Webster Equity Partners has officially launched the sale process of its Bristol Hospice asset, according to PE Hub. Bristol is one of the last private equity-backed hospice companies of scale that is likely to come to market in the near future.
Bristol is a large multi-regional player that has grown seven times larger since Webster purchased the company in 2017. The hospice operates 35 locations across 10 states, and its EBITDA exceeds $70 million PE Hub has reported.
Private equity firms have been bullish on hospice acquisitions during 2020 and industry observers expect that trend to continue this year.
“The fourth quarter of 2020 marked a continuation of strong consolidation activity within the home health and hospice sectors,” Provident Healthcare Partners noted in a recent M&A report. “The combination of several private equity backed platforms reaching inflection points within their investment cycles and the continued strong performance of the publicly traded groups have led to increased competition and frothy valuations.”
A Bristol deal could rival the purchase of St. Croix Hospice in October by the private equity firm H.I.G. Capital for an undisclosed sum. Minnesota-headquartered St. Croix, previously owned by the investment firm the Vistria Group, has a large Midwestern footprint that extends across six states and has completed a number of acquisitions of its own during 2019 and 2020, as well as adding five de novos last year and one so far in 2021.
Bristol itself has been very active in the M&A market. The company completed nine acquisitions during 2020 and 14 in total since Webster purchased the agency. Among its 2020 transactions were the purchases of Remita Health in September, Sojourn Hospice & Palliative Care in March and the hospice operations of Visiting Nurse Association of the Inland Counties (VNA). Financial terms for these transactions were undisclosed.
Bristol also purchased the California operations of Companion Hospice for a confidential sum, filling a gap in its geographic service area. Companion retained its Texas and Arizona locations.
High price tags on hospice companies have not scared away buyers, even as multiples in the space reached as high as 26x during 2020.
“It seems like every quarter we’re saying demand for hospice is at an all-time high — and then we see even more demand materialize,” Cory Mertz, managing partner at the M&A advisory firm Mertz Taggart, said.
Companies featured in this article:
Bristol Hospice, Companion Hospice, H.I.G. Capital, Remita Health, Sojourn Hospice & Palliative Care, St. Croix Hospice, Visiting Nurse Association of the Inland Counties, Vistria Group, Webster Equity Partners
