The Riverside Company has completed the sale of workers compensation medicine network Align Networks to Apax Partners, generating more than a 12x return multiple.
Riverside’s investment of $15 million came in 2008 when it acquired a 50 percent stake in physical medicine services provider Universal SmartComp. In 2012, Riverside merged the company with Align, a portfolio company of General Atlantic, which has also exited its investment in Align. Riverside made its original investment from its $250 million Riverside Micro-Cap fund.
During the holding period, Riverside invested heavily in sales and added several members to the company’s board.
“The company flourished since 2012, and that’s what led to the sale to Apax,” Loren Schlachet, Riverside managing partner, told Private Equity International. “The market in the physical therapy space is a multi-billion dollar market but it’s just partially penetrated right now with specialty physical therapy networks. There is still a lot of available market to be had and a lot of growth left for the next buyer.”
The sale marks Riverside’s 10th exit of 2013 and fourth from its Micro-Cap fund.
Riverside focuses on acquiring businesses valued at up to $250 million. The firm has invested in more than 320 transactions and has an international portfolio of more than 70 companies.