Irving Place Capital Management scored big in August — $1.74 billion big. The private equity firm sold Universal Hospital Services, a medical equipment management company, to Federal Street Acquisition Corp. (NASDAQ: FSAC), a special purpose acquisition company sponsored by an affiliate of Thomas H. Lee Partners.
Universal Hospital’s diverse customer base includes over 4,000 acute care hospitals, 4,000 alternate site providers, and over 150 major medical equipment manufacturers.
Under the terms of the agreement, Federal Street and Universal Hospital will combine under a new holding company to be named Agiliti, Inc., which intends to apply to have its common stock and warrants listed on the NASADA Stock Market under the ticker symbols AGTI and AGTIW, respectively.
The purchase price implies an initial enterprise value for the combined company of approximately $1.74 billion, or 11.6x UHS’s forecasted 2018 Adjusted EBITDA of approximately $150 million and 10.2x UHS’s forecasted 2019 Adjusted EBITDA of approximately $170 million, in each case, based on the higher end of UHS’s forecasted Adjusted EBITDA range.
Irving Capital will retain a minority equity stake in the combined company.