Behrman sells Tandem Health for $620m

Private equity firm Behrman Capital announced that it has sold its portfolio company, Tandem Health Care, a healthcare service provider, to JER Partners and Formation Capital in a $620m transaction—its second major successful healthcare exit this quarter.

Behrman Capital said today that it has sold the Maitland, Florida-based healthcare provider Tandem Health Care to a consortium consisting of JER Partners and Formation Capital in a deal valued at $620 million (€488 million). JER and Formation announced plans to restructure Tandem in part into an owner of skilled nursing and other senior housing facilities.

Since Behrman first invested in Tandem, the firm has steadily grown the company, in part through more than a dozen add-on acquisitions. Indeed, Tandem’s annual revenue has grown from $25 million to some $600 million—a 2400 percent gain—since its involvement with Behrman began in 1998. Tandem currently employs more than 12,000 people in 13 states, and operates 78 facilities.

This past April, Behrman completed another recent successful exit with its sale of Worcester, Massachusetts-based biomedical company Athena Diagnostics for about $283 million (€223 million), in a deal in which Behrman received $202 million in equity. Behrman had acquired Athena in 2002 from Elan Pharmaceuticals for $67.5 million in equity.

Behrman’s investments are focused in the aforementioned healthcare industry, specialty manufacturing, outsourcing, and information technology. Its current combined capital base is $1.8 billion.