Rapidly Growing Skilled Nursing and Home Care Company

Industry

Home Health Services

Location

Boston
Metro West

Business Broker

Sarah Grossman

Situation

The founder and owner of this home care company met with Sarah Grossman, Principal of BayState Business Brokers to discuss selling her business back in 2022. BayState prepared a valuation for the business, but the owner wanted a higher valuation and listed her business with another business broker.

Years later, Sarah reached back out to the owner to learn that the previous business broker had not sold her business. That broker lacked industry experience, and also didn’t focus on the main goals of the seller and being a strategic partner with her during the sale. She wanted a different approach and listed her business with Sarah and BayState Business Brokers.

BayState Business Brokers’ Approach

Sarah Grossman has successfully brokered the sales of many private home health businesses. With her outreach, she primarily targeted private equity and strategic buyers, using a structured auction process to generate interest and a competitive bid environment.

The business owner had built a successful, desirable business that was both ready to sell and ready to easily transfer to new ownership. She had capitalized on the market demand for quality, private pay home care and skilled nursing services. She had attracted and retained loyal and skilled staff including nurses, case managers, recruiters and schedulers, and had many long-term clients and strong referral sources. Additionally, she had put in place systems and processes to enable growth with thorough reporting and KPIs to readily provide to prospective buyers. The business was running well and independent of her daily involvement. Because of this, it was highly attractive to many buyers.

The listing generated multiple offers, but many of them had contingent payments based on customer retention due to some customer concentration risk. Many brokers would have pushed the seller to accept a suboptimal offer, but Sarah remained patient and focused on the seller’s goals and ideal result.  The seller remained motivated to maximize value and was successful in addressing prospective buyers’ concerns over high customer concentration by replacing a large client who moved out of market with multiple new clients. Additionally, the business continued to grow significantly in a very short time.

With continued growth in EBITDA, Sarah secured a strong prospective buyer from a family office. Family offices are long-term investors of privately held companies. Unlike private equity, they typically retain the company indefinitely and are sometimes more hands-on. In this case, the buyer had an operating partner with some experience in nursing, who would oversee the operations of the company.

The buyer and his business partner readily saw the strength of the business, respected the owner and the business she had built and embraced a win-win mentality, expressing the intent to make the transaction a success for both seller and buyer. The two parties developed a strong, mutually-respectful relationship and an offer was presented and accepted by the seller.

Results

The diligence period went smoothly because the owner had systems in place to easily provide the documentation the buyer needed. Weekly calls kept the buyer and seller connected and working in tandem towards a closing, while addressing the buyer’s questions about the company as they continued their diligence. Even with the connection, the seller still felt nervous about the transition and telling her long-term staff about the sale. As her trusted advisor, Sarah listened, addressed her concerns and worked with all parties to make sure everyone was comfortable and the transition went smoothly.  

Today, she has peace of mind that her team all remain working at the business and that they are all in good hands with professionals whom she likes and respects.