Excellere runs two-asset GP-led on AIS Healthcare, LucidHealth

Excellere Partners is running a process on two portfolio companies that would extend the firm’s hold over the companies and bring in outside capital to continue growing the businesses, sources told affiliate title Buyouts.

The deal, a two-asset GP-led secondaries process, is among several high-profile transactions that have moved through the market this year. GP-led deal activity has slowed in the market downturn as buyers look for mostly high-quality assets and continue to seek diversity through LP portfolio sales.

The two assets are AIS Healthcare, a provider of targeted drug delivery infusion care and ophthalmology services, and LucidHealth, an outsourced provider of radiology services. Excellere invested in AIS in 2018 through its third fund and LucidHealth in 2016. Excellere closed Fund III on $625 million in 2015.

Excellere hired William Blair to seek buyers for LucidHealth in 2021, marketing the company off of about $60 million of adjusted EBITDA as of 2020, affiliate title PE Hub reported at the time.

Generally in such deals, LPs in the older funds holding the target assets have the option to cash out of their interests in the companies, or roll into the continuation fund. It’s not clear if LPs in Excellere’s process have the option to roll on primarily the same terms.

Excellere did not respond to a comment request Monday. The firm is understood to be working with Evercore on the deal.

Excellere was formed in 2006 by David Kessenich and Robert Martin, both of whom have died. The management company’s managing members are Ryan Glaws, Bradford Cornell, Matthew Hicks and Patrick O’Keefe, according to Excellere’s Form ADV.

The firm targets investments in healthcare services, industrial growth and business services. Excellere closed its most recent pool, Fund IV, on $875 million in 2021.

GP-led deals represented about 35 percent of the estimated $50 billion of total secondaries volume in the first half, according to PJT Park Hill’s first-half volume survey.

Sources have said the market contains robust, “pent-up” demand among GPs to run processes on choice assets. But activity remains somewhat muted due to pricing expectations and capital limitations. Several buyers have closed funds recently but remain picky on what deals they’ll pursue. This is a similar dynamic that is keeping the regular M&A market slow.

Still, activity has remained steady in the mid-market, with a handful of processes finding their way to close. One such deal is being run by Sun Capital, which is working to move its asset Cotton Holdings into a continuation fund, Buyouts reported last month.