Cascade Partners' Industrials Report Now Available

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Cascade Partners has released its Industrials Industry Update highlighting some of the key trends in manufacturing. Some highlights from the report include:

  • The U.S. industrials market remains the most active and vibrant in the world
  • Opportunities are robust for both buyers and sellers
  • Sluggish organic growth and a desire to contain costs have led many manufacturing executives to utilize mergers and acquisitions as a tool to accelerate growth, increase scale and capture market share. 

Murray Feldman Covers Healthcare M&A Trend with Cascade's Rajesh Kothari

You can read the transcript below or listen to the report that ran on WWJ Radio on March 27 at 6:23am. 

Feldman Report Transcript:  Cascade Partners

WWJ RADIO DETROIT

March 27, 2017 6:23 a.m.

ANCHOR MURRAY FELDMAN:  The time is 6:23.  Companies are looking to invest in your doctor’s office.  I’m Murray Feldman with the Feldman Report on WWJ News Radio 950. 

Cascade Partners of Southfield has just helped Grand Rapids Ophthalmology partner up with a Chicago-based private equity firm, Sterling Partners. 

That’s just part of a big story. 

Raj Kothari at Cascade says Sterling Partners will bring business skills and consumer marketing skills to the Michigan operation so that doctors can just focus on being doctors.  The doctors will still own part of the company. 

These partnerships are happening in all medical fields.  In fact, Raj Kothari has done three of them and expects many more.  Four hundred deals have taken place around the country.  Twenty private equity firms are looking right now for eye care practices to buy into.  And if this hasn’t come to a doctor’s office you’re using, chances are it will. 

As Raj Kothari contends, the field of medicine is getting too complicated for doctors to manage the practices on their own, so they’ll partner up with business folks to run the business and they’ll run the medical part.  With the Feldman Report, I’m Murray Feldman, WWJ.

Cascade Partners Speaks with MiBiz on Grand Rapids Ophthalmology's Plan to Expand

Interested in reading the plans Grand Rapids Ophthalmology has for expansion?

Read the entire article here at MiBiz.

Here is an excerpt:

"The pressures from the changing economics, a tougher reimbursement environment and value-based contracting in health care have been driving consolidation for some time among physician practices, said Rajesh Kothari, managing director of Southfield-based investment banking firm Cascade Partners LLC that advised Grand Rapids Ophthalmology on the deal.

That consolidation trend is now pushing into specialties such as ophthalmology, dermatology and emergency medicine practices, Kothari said.

“It’s harder and harder as a small practice to be able to compete against the insurance companies, compete against the hospital systems and ultimately live with the changing world of Medicare and Medicaid,” he said.

A report Cascade Partners issued last summer noted the aging population is driving up incidence rates of macular degeneration, cataracts and glaucoma. It also cited health care reform as expanding the number of patients with vision benefits. Combined, those two trends are driving opportunity for the entire vision market.

“Eye care is a very fragmented market and there’s no big consolidator,” Kothari said."

 

Grand Rapids Business Journal covers Grand Rapids Ophthalmology Deal

Grand Rapids Business Journal covered the deal and the consolidation in the eye care space. 

"The partnership is an example of a growing trend by specialty medical practices to consolidate through private equity mergers and partnerships, according to Southfield-based Cascade Partners, which advised GRO in the process. This is the third physician practice management merger Cascade has advised in the last two years.

In the past five years, almost 400 transactions have been completed in the U.S. physician practice management sector, and there are more than 20 private equity firms actively seeking eye care practices for their portfolios, according to Cascade Partners."

Read the entire article here.

Sterling Partners Announces Strategic Partnership with Grand Rapids Ophthalmology

In connection with the partnership, Sterling has formed Great Lakes MSO to provide comprehensive management support to Grand Rapids Ophthalmology and other leading eye care practices

Grand Rapids, Mich., February 23, 2017 – Sterling Partners announced today that it has partnered with Grand Rapids Ophthalmology (“GRO”), a leading comprehensive eye care provider offering ophthalmology, optometry, and retail optical services throughout West Michigan. GRO is the first eye care provider to join Great Lakes Management Services Organization (“Great Lakes MSO”), a practice management services organization formed by Sterling to support GRO’s local expansion and larger-scale growth through Great Lakes’ resources, management team, and capital.

Founded in 1982, GRO is recognized as one of the largest fully-integrated eye care medical groups in West Michigan. It offers a full suite of eye care services including optometry, retail optical, oculoplastics, cataract surgery, and retinal subspecialties. GRO’s eye care services are supported by experienced professionals, a fully-integrated back office, and technologically advanced capabilities. The company employs the largest number of eye care specialists and professionals in the region – 11 ophthalmologists, 18 optometrists, and 180 other technicians and staff in 11 locations.

“For more than 30 years, Grand Rapids Ophthalmology has delivered exceptional service and the highest-quality care to our patients. The brand and reputation we’ve worked so hard to build will not change, and now we have an exciting opportunity to further solidify our strong market position,” said David Barrett, M.D. “With the additional resources and expertise we now have through our partnership with Sterling, we’ll be able to continue to invest in our employees and the most advanced technologies and systems to ultimately benefit patients not just in West Michigan but well beyond.”

While GRO has experienced strong organic growth over its 34-year history, the leadership team recognized the opportunity to expand its reach and scale by partnering with a like-minded and growth-oriented investor. GRO will continue to operate as Grand Rapids Ophthalmology, and all of GRO’s shareholders will maintain their current roles and ownership through Great Lakes MSO. The partnership with Sterling allows GRO’s management team to pursue near-term and larger-scale growth opportunities, evolve clinical development to better serve patients, offer additional career development opportunities and job stability to its employees, and form strategic partnerships with healthcare systems, regional employers, and retailers.

“We were looking for a partner that recognized the value of what’s been created to date and would bring the necessary resources to accelerate our expansion,” said Michael Boyle, M.D. “What drew us to Sterling Partners was their management expertise, access to additional capital, a growth-focused vision to leverage the existing infrastructure in order to aggressively expand, and Sterling’s long history of investing and growing healthcare services businesses.” 

Steven Taslitz, Chairman and Co-Founder of Sterling Partners, added, “The consolidating eye care market combined with the aging U.S. population that needs eye care services equates to significant growth potential for GRO. At Sterling, we look to partner with differentiated healthcare services companies that provide accessible and high-quality services in a complex system. We’re excited to work with Dr. Barrett, Dr. Boyle, and their team to take GRO through its next phase of growth.”

Cascade Partners LLC served as the exclusive financial advisor to Grand Rapids Ophthalmology in this transaction. Rajesh U. Kothari, managing director at Cascade Partners said, “GRO’s partnership with Sterling Partners is a great example of the opportunity for physician groups to build their practices and realize the value in what they have created. The $400 billion Physician Practice Management market is experiencing some of the highest levels of investment and acquisition activity within the healthcare services market. The heightened level of activity is being driven by accelerating interest from private equity and strategic partners providing a breadth of growth and liquidity options.”

About Grand Rapids Ophthalmology

Grand Rapids Ophthalmology provides experienced professionals including 11 ophthalmologists and 18 optometrists at locations throughout West Michigan to offer convenient and easy access to professional care. GRO’s mission is to provide a broad spectrum of high-quality, state-of-the-art eye care, products, and services with the highest ethical standards and with unrivaled service to patients. GRO further strives to provide its patients, staff, and doctors with an outstanding work environment. For more information, visit: https://www.seeitclear.com/.

About Sterling Partners

Sterling Partners is a private equity firm with a distinct point of view on how to build great companies. Founded in 1983, with over $4 billion of assets under management, Sterling is guided by its stated purpose, INSPIRED GROWTH®, which describes Sterling's approach to investing in differentiated businesses and growing them in inspired ways. Sterling focuses on investing growth capital in middle-market companies in the healthcare services and business services industries. Sterling provides valuable support to the management teams of the companies in which the firm invests through a deep and dedicated team of professionals, including a strong network of outside directors and advisors. The people at Sterling believe in ideas and ideals, in people and in partnerships that drive long-term success. For more information, visit: www.sterlingpartners.com.

About Cascade Partners

Cascade Partners LLC is an investment banking and private investment firm serving entrepreneurs, businesses and investors active in the middle market.  Drawing on the deep management, investment and transaction experience of its principals, Cascade Partners provides the guidance and resources necessary to navigate the complexities of managing growth, acquisitions, divestitures, financing and other strategic initiatives. 

In select situations, Cascade Partners provides mezzanine and equity capital, directly or with its partners, to fund growth financings, acquisitions or change of control transactions involving value-added manufacturing, healthcare and technology enabled business service companies.

Cascade Partners has offices throughout the Midwest United States including Detroit, Michigan; Cleveland, Ohio and Chicago, Illinois.

Quaker Chemical Corporation (NYSE: KWR) has acquired Lubricor Inc.

Quaker Acquires Lubricor Inc. Canadian Metalworking Fluids Business

CONSHOHOCKEN, Pa., Nov. 30, 2016 /PRNewswire/ -- Quaker Chemical Corporation (NYSE: KWR) announced today that it has acquired Lubricor Inc., a manufacturer and marketer of metalworking fluids based in Waterloo, Ontario, for approximately 16 million Canadian dollars, or $11.8 million.  Lubricor annually sells approximately $10 million of branded products directly to its North American customers, primarily automotive suppliers, and into Southeast Asia through a distributor relationship in Thailand.  Also, Lubricor has an annual estimated EBITDA of approximately $1.6 million.

Want to read more? View the press release on Quaker Chemical's website here.

MiBiz quotes Rajesh Kothari on the M&A environment in Automotive and beyond

John Wiegand interviewed our own Rajesh Kothari on the state of the M&A environment in reaction to Blackford Capital's latest acquisiton. 

Read the entire article online here.

Highlights of the interview include:

  • “We’re definitely seeing a little bit of cooling in the interest in some automotive suppliers, depending on where they are in the segment of the market,” Kothari said. 
  • Despite the slight slowing in deal activity this year, multiples continue to be strong, particularly for well-structured, technologically advanced manufacturers, he said. Multiples for middle-market, highly specialized companies hover between five and seven times earnings before interest, taxes, depreciation and amortization (EBITDA). 
  • “We’re seeing a lot of buy-side interest in recent months more than anything else,” he said. “Buyers are saying, ‘We have more cash.’ The dynamic we’re seeing more and more is there’s a growing interest in the opportunity to grow through acquisition.” 
  • “There’s no sign in the U.S. economy domestically that things are slowing down,” he said. “We’re growing at a slow and steady pace and that’s helped people not go over their skis. The (vehicle) fleet is still old, people are buying new cars — there’s no sign that’s going to back off.” 

Be sure to check out the article at MiBiz here.

Cascade Partners' Healthcare Update

Cascade Partners has released its Healthcare Industry Update highlighting the Physician Practice Management sub sector. Some highlights from the report include:

  • The $440 billion physician practice management market is experiencing some of the highest levels of M&A activity of any facet within the medical services market. 
  • The growth and stability of the health economy is receiving increased interest from the private sector, and, in recent years, M&A in healthcare has outpaced other industries
  • Much of the consolidation is being driven by:
    • Practices seeking scale to spread escalating costs over a larger patient population
    • Practices seeking to capture increased market share to provide negotiating power with commercial insurers, hospitals and related organizations
    • Exceptionally high valuations
    • Private equity funds more aggressively pursuing the market

Today, more than anytime in recent history physicians have the broadest set of options to realize the value in their practices. Hospital systems, private equity and public companies are all focused on building the scale within physician services. 

Interested in learning more? 

Rajesh Kothari quoted in Crain's article about Accumen Acquisition

Jay Greene of Crain's Detroit spoke with Rajesh Kothari, Managing Director at Cascade Partners about Accumen's acquisition of Ann Arbor-based Chi Solutions. See what Rajesh had to say below or click on this link to read the full article.

Rajesh Kothari, managing director with Southfield-based Cascade Partners LLC, said Accumen's business model is similar to other industries such as energy and equipment management, but it is only starting to be tried in health care.

“These programs work very well because it creates alignment between the vendor and the customer. If the customer saves money, then the vendor makes money,” Kothari said. “They can’t just make a recommendation and hope it works. They are incentivized to make it work. Accumen is looking at this acquisition as a way to capture more of the value they are providing with Chi’s programs, expertise and insight into this business model.”

Cascade Partners Expands with New Director


Kevin Groff Brings Wall Street Experience to Main Street

SOUTHFIELD, MICH. (June 14, 2016) – Cascade Partners LLC today announced the hiring of Kevin Groff as a director in its Cleveland office. Groff joins Cascade from a unit of Wyndham Worldwide (NYSE: WYN), where he served as vice president of global corporate & strategic development focused on specialty lodging acquisitions. Groff brings 15 years of broad transactional M&A and business development experience to the Cascade Partners team.

“Kevin, like the rest of the Cascade Partner’s leadership team, has a strong foundation in management, investment and transaction execution” says Rajesh Kothari, managing director. “Our client partners will benefit from his middle market expertise and Wall Street experience.”

Prior to managing acquisitions for Wyndham, Groff spent over a decade driving growth initiatives for middle market businesses, both as an advisor and corporate development officer for middle market businesses.  In addition, Groff spent almost a decade as a vice president of a boutique business advisory firm managing merger, acquisition, divestment and capital raising mandates in the lower middle market. He has worked for publicly traded companies, private equity and privately-held organizations.

Kevin Groff has an MBA from New York University’s Stern School of Business and a BA in International Business and Spanish from Ohio Wesleyan University.

ABOUT CASCADE PARTNERS

Cascade Partners LLC is an investment banking and private investment firm serving entrepreneurs, businesses and investors active in the middle market.  Drawing on the deep management, investment and transaction experience of its principals, Cascade Partners provides the guidance and resources necessary to navigate the complexities of managing growth, acquisitions, divestitures, financing and other strategic initiatives. 

In select situations, Cascade Partners provides mezzanine and equity capital, directly or with its partners, to fund growth financings, acquisitions or change of control transactions involving value-added manufacturing, healthcare and technology enabled business service companies.

Cascade Partners has offices throughout the Midwest United States including Detroit, Michigan; Cleveland, Ohio and Chicago, Illinois.