June 15, 2018 - ARM/RCM Issue:
Middle-Market M&A - Why Lower Mid-Market Healthcare M&A is Poised for Growth
By: Dana Pawlicki, Mergers & Acquisitions
It is without question that the private equity healthcare sector is storming into 2018. Extremely robust deal activity continues from 2017's momentum in all size levels of the market, ranging from the lower middle-market to large buyout.

Driven by healthy valuations in the public markets and funds flush with new capital, Stonington Capital Advisors fully expects these forces to continue to drive frenzied deal activity through 2018. Healthcare generally has returned to being the highest returning sector of the broader market (one only need look at United Health Group's share price to evidence the sector's recent success on the large public company level), and after a few years of a relative softness, biotechnology has bounced back in a big way.

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News You Can Use
Deriving Normalized EBITDA for Your Business  
By:  Michael Thomas

We recently wrote an article about the dangers of failing to properly document business meal and other entertainment expenses. The piece raised quite a few concerns among business owners.

The question we most often heard usually went something like this, "Wait, I thought personal expenses like meals, travel, and entertainment could be normalized...what gives?" Answers to questions such as these, unfortunately, are never straightforward and true standards for deriving normalized EBITDA calculations don't exist.

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5 External Factors that Could Impact Value
By:  Tom Edens 
  1. Private Equity Overhang - The amount of funds Private Equity Groups have raised and not invested that are chasing deals could have an upward bias on valuations.
  2. Corporate Cash Balance - The amount of cash corporate / strategic acquirers have on their balance sheets and available for acquisitions could influence mid-market values.
  3. Interest Rates - Generally, the lower the interest rates, the more leverage an acquisition target will bear, therefore the more the acquirer can pay.
  4. Equity Market - Generally, the healthier the equity market, the more confidence acquirers of private mid-market companies are.
  5. Legislation - If there is pending legislature on the state or national level that might materially affect the ARM or Healthcare RCM industries, it could dampen the confidence to pay up by acquirers.

ARM/RCM - Recent Industry Transactions
Target Description 
March 2018 
Probe Group 
Salmat's Contact Business 
Operator of contact centers in Australia, New Zealand and the Philippines
March 2018 
PatientCard, LLC 
Healthcare finance company  
April 2018
Cognizant Technology Solutions Corporation (CTSH)
Bolder Healthcare Solutions 
Revenue cycle management company serving hospitals, physician practices and other healthcare organizations
April 2018
NewSpring Mezzanine and LaSalle Capital 
Brown & Joseph, Ltd.  
Provider of commercial accounts receivable management solutions  
April 2018 
AdvantEdge Healthcare Solutions, Inc.
Professional Management, Inc. 
Revenue cycle management services firm serving healthcare providers 
May 2018
Orion Healthcorp 
Revenue cycle, practice management and group purchasing organization assets  
May 2018
Aquiline Capital Partners 
Aspirion Health Resources
WC & MVA niche RCM services company  

About Us  

Marion Financial Corp. is a merger and acquisition advisory firm based in Houston, Texas.  Marion Financial has had an industry focus in the Accounts Receivable Management (ARM) and Revenue Cycle Management (RCM) sectors since 1995.

Tom Edens


713-988-8000 ext.111


Marisa Fiorito

Director - Financial Analysis

713-988-8000 ext.114


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