Holding company combines Valley Healthcare, Northwest Medical

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Tuesday, September 11, 2018

RENO, Nev. – Great Elm Capital Group has partnered with Mesa, Ariz.-based Valley Healthcare Group to acquire Portland, Ore.-based Northwest Medical and combine the two companies.

The deal creates a leading regional provider of sleep and respiratory equipment and services across Arizona, Nebraska, Washington, Oregon and Alaska serving about 70,000 patients annually, according to a press release.

“With Great Elm’s support, we believe that we will continue to grow organically, as well as be an acquirer of choice for other sleep and respiratory focused businesses that share our commitment to high-quality patient care,” said Ron Evans, co-founder and CEO of Valley Healthcare.

Northwest Medical is Valley Healthcare’s eighth acquisition since Ron and Pam Evans co-founded the company in 2006.

The combined companies, which will continue to operate under local brand names, generated $43.6 million in revenue, $2.5 million in net income, and $11.1 million in adjusted EBITDA in the calendar year 2017, according to the release.

To complete the transaction, Great Elm purchased an 80.1% equity interest in an entity formed to acquire and combine Valley Healthcare and Northwest Medical. It funded the $63.6 million transaction using $19.7 million in cash from its balance sheet, with the remainder funded using $31.3 million of secured debt, $5.3 million of qualified preferred stock and $7.3 million of equity rollover from Ron and Pam Evans and Corbel Capital Partners, a structured debt and equity fund.