Alceon checks into new healthcare roll-up, third deal for PE arm

Alceon’s new-look private equity team has wasted no time whipping up a new portfolio, securing its third investment since the beginning of the year.

September 23, 2021
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Alceon checks into new healthcare roll-up, third deal for PE arm

Anthony Macdonald, Sarah Thompson and Kanika Sood

Alceon’s new-look private equity team has wasted no time whipping up a new portfolio, securing its third investment since the beginning of the year.

Alceon’s PE arm, run by co-heads Zac Midalia and David Wilshire, has struck a deal to acquire ophthalmology and short stay hospital roll-up Specialist Medical Services, as the first step of a bigger push into the world of day surgery and Australia’s healthcare sector.

Alceon’s PE co-heads, David Wilshire and Zac Midalia, are jumping into the world of ophthalmology and day surgery.

Dominic Lorrimer

It is understood Alceon invested $45 million into SMS Healthcare and will work with SMS Healthcare’s Carl Adams, a seasoned healthcare roll-up expert who helped Quadrant Private Equity stitch up radiology business QScan, to create a bigger business.

The new combination reckons short stay hospitals and ophthalmology are a relatively untapped opportunity, given fragmentation in the market and industry tailwinds.

There’s only one other corporate player of size in ophthalmology - ex Primary Health Care business Vision Eye Institute - and growing demand for procedures on cataracts, laser eye surgery and the like. Ophthalmology is the biggest line of business in day surgery.


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The initial portfolio includes about a dozen sites in Sydney, and Alceon’s investment leaves ample room to pick up more.

SMS Healthcare is understood to have additional exclusive ophthalmology and short stay hospital opportunities already in its M&A pipeline, and will pitch its willingness to partner up with doctors. Bolt-on deals are expected to be worth $5 million to $30 million, and finalised before the end of the year.

“We’re really excited to back Carl, the team of leading doctors and the broader SMS team,” Midalia told Street Talk on Thursday.

It’s a coup for Alceon’s team, which has put more than $100 million to work this year across its three new deals.

Midalia and Wilshire, working closely with Alceon founding partners Trevor Loewensohn, Phil Green and Morris Symonds, took the reins to Alceon’s PE unit earlier this year.

Midalia joined Alceon from Ruffy Geminder’s Kin Group, where he was behind its opportunistic acquisition of a stake in The Reject Shop in 2018, and formerly worked with Mark Carnegie. Wilshire is an ex-Macquarie Capital and Goldman Sachs banker who joined Babcock & Brown and ultimately Alceon as a founding team member.

The pair has turbocharged Alceon’s PE strategy, cutting deals to buy civil infrastructure focussed equipment hire business Orange Hire (with Arcadia Capital), taking part in Think Childcare’s take-private (which is headed to Busy Bees) and is also tipping funds into Mosaic alongside Spotlight Group’s Danfin.

Alceon has deployed more than $5 billion since 2010, about 70 per cent of which went into real estate investments. The new PE team is trying to even the ledger.

The healthcare deal comes as Alceon’s five-strong PE unit is also understood to have been scratching around grocer Harris Farm, which is talking to potential suitors and lenders in a process run by Goldman Sachs.

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