High Road reaps 3.1x return on second exit

The firm has sold healthcare services business Accentus, which quadrupled revenues and EBITDA under High Road’s ownership.

High Road Capital Partners has sold healthcare services company Accentus, generating a 3.1x return multiple and 49 percent gross IRR.

The Ontario-based company provides medical transcription, document imaging and remote coding technology services to hospitals and physician groups in North America. The sale marks High Road’s second ever exit since spinning out of The Riverside Company in 2007, and the divestment of its third portfolio company, purchased in March of 2009. High Road sold industrial gear manufacturer Milwaukee Gear Company for $80 million in February, generating a 2.6x return multiple and 31.6 percent IRR.

During the holding period for Accentus, the company’s revenues and earnings before tax, interest, depreciation and amortisation grew by 400 percent.

“The market in and of itself was growing fairly nicely so the company had high double digit organic growth,” High Road managing partner Bob Fitzsimmons told Private Equity International. The firm also made four add-on acquisitions, three in the US and one in India.

High Road invests in “fundamentally sound” companies in North America in a variety of sectors, including manufacturing, services, distribution, healthcare and media.

“An area where we’ve certainly developed our focus has been greater level of involvement of operating partners,” Fitzsimmons said. “We have operating partners come out with us on the first visits to the companies and they’re integrally involved in the value creation process from before the time we acquire the company straight through the exit.”

High Road now has eight platform investments in its portfolio, for which it has made 10 add-on acquisitions. The New York-based firm invests in lower mid-market businesses with revenues of $10 million to $100 million and EBITDA of $3 million to $10 million.

High Road’s debut fund closed on $153 million in 2009.