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GTCR completes buyout of prison healthcare services provider CHC

2 Jan 2013

chc_sqChicago-based mid-market buyout house GTCR has completed its acquisition of Correctional Healthcare Companies (CHC), a provider of outsourced inmate healthcare services to jails and prisons in the US.

The firm is partnering with CHC chief executive Doug Goetz, chief operating officer Don Houston and managed care industry executive Dale Wolf to expand the business through organic growth and acquisitions.

Wolf, the former chief executive of Coventry Health Care, has joined the business as executive chairman as part of the deal.

Financial terms of the transaction were not disclosed.

CHC provides fully-staffed managed healthcare to correctional facilities, serving over 64,000 inmates in over 250 correctional facilities across 26 states.

It also provides community-based mental health services to over 20,000 probationers and parolees annually, and assists over 250 local courts with probation management services.

“GTCR’s extensive experience investing in both healthcare provider and payor businesses enabled us to develop a unique perspective on CHC and its growth opportunities going forward,” GTCR managing director David Katz said in the statement.

Latham & Watkins served as legal counsel to GTCR, while NXT Capital, CapitalSource, Bank of Ireland and Prospect Capital provided debt financing in connection with the deal.

The investment was made through the firm’s $3.25bn GTCR Fund X vehicle.

GTCR’s 2006-vintage Fund IX vehicle more than doubled its net IRR to over eight per cent in the first quarter of 2012 having recently moved into its exit stage, according to public disclosures in September from the Washington State Investment Board.

The firm is also understood to have hired Morgan Stanley to sell Fund IX’s aircraft maintenance services company Landmark Aviation, which it bought in 2007 alongside Platform Partners.

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