PE’s “Laser Focus” on Ophthalmology: The Answers to Five Key Questions Regarding Private Equity Transactions

Ophthalmology Management

Gary W. Herschman and Anjana D. Patel, Members of the Firm in the Health Care & Life Sciences practice, in the firm’s Newark office, co-authored an article in Ophthalmology Management, titled “PE’s “Laser Focus” on Ophthalmology: The Answers to Five Key Questions Regarding Private Equity Transactions.”

Following is an excerpt:

It seems like every week or two that an industry newsletter or publication announces that another eye-care practice has entered into a major transaction with a private equity (PE)–backed company. This transaction activity has increased substantially over the past several years. Physicians First reported that the number of PE firms investing in ophthalmology alone jumped from five firms in 2016 to 20 by October 2018 and each of these “platform” companies is seeking so-called “add-on” acquisitions to grow.

With this increased activity, you may be receiving calls about being purchased, and you likely are hearing about other groups in your market doing so. As a result, you may be wondering, “Should I consider a transaction with a PE company now?”

Before moving forward, it is essential that eye-care groups and their executives understand the answers to five key questions.

  1. What’s driving PE’s focus on eye care?
  2. How are eye-care groups valued?
  3. What factors should I consider?
  4. How are PE transactions structured?
  5. How do I optimize practice value and success?