Clinovia
Transaction Background
In September 1998 Graphite Capital led the management buy-out/buy-in of Clinovia from its US parent. Clinovia is a leading provider of home health care services in the UK, principally to the NHS.
Deal Attractions
Graphite backed the former managing director of Clinovia to re-invigorate the business and restore its profitability. Clinovia’s balance sheet at the time of acquisition included a large amount of cash which was subsequently used to finance the restructuring programme and pay down the acquisition debt.
Achievements
- the business was restructured to improve profit margins, product delivery and general management
- the management team developed an effective marketing strategy to differentiate Clinovia from its competitors and to establish premium pricing for its products
- product penetration and market share were increased
- operating profit more than trebled to £3.0 million under our ownership
Exit
- in July 2000 Clinovia was sold to LVL Medical, a pan-European home health care group based in France
- the acquisition debt had been fully repaid from internally generated cashflow
- the sale yielded a multiple of 7.9 times the cost of our investment and an internal rate of return of over 200 per cent
