Clarion nets 25x return on healthcare services exit

The mid-market firm has sold Crowe Paradis Services for about $90m, as it plots a return to market for Fund II.

Clarion Capital Partners has sold Medicare compliance company Crowe Paradis Services to Verisk Analytics for $90 million.

The New York-based mid-market firm has generated roughly a 25x return multiple on the transaction.
Clarion acquired Crowe Paradis in 2006, investing from the firm’s debut fund, which closed on $255 million in August 2005. Crowe Paradis provides Medicare compliance services to insurance companies.

“I think that you’re seeing that phenomenon where strategic buyers are active,” partner at Clarion Eric Kogan told PEO. “Private equity firms are also active, but in the smaller deal size range financing is still highly uncertain. It’s still a really choppy market down under the $100 million in loan size,” he said.

Clarion’s maiden fund is nearly fully invested, and the firm is forming plans for its second vehicle, which would likely be raised over the next 12 to 18 months, Kogan said. That fund will have a target size similar to its predecessor fund, and the firm will continue to invest in mid-market companies.

Roughly half of Clarion’s portfolio consists of companies in the business services sector. The firm also invests in healthcare services, specialty financial services, consumer products, specialty retail and media and entertainment.