Advent supports Australia radiology merger

The transaction size was not disclosed but the combined entity will have an annual revenue of approximately A$150 million ($140 million) and over 50 radiologists and 600 employees across four states.

Advent essentially teamed up with the radiologists and management who own Lake Imaging to support the merger with South Coast Radiology. John Livingston, the company's CEO, said in a statement that Lake Imaging is unique in the industry because radiologists hold the majority of shares and take responsibility for all local clinical matters.

Mark Jago, executive director at the private equity firm noted that "diagnostic imaging is a critical and central part of quality healthcare," with sector growth exceeding 8% per annum over the last five years.

Founded in 2002, Lake Imaging is the largest radiology group in Victoria and it has seen consistent growth through acquisitions and greenfield expansion. It recently invested in Global Diagnostics Australia, a leading Western Australia-based diagnostic imaging and tele-radiology services provider.

South Coast Radiology, meanwhile, has been around for 45 years and is the largest independent radiology player in Queensland. It operates predominantly on the Gold Coast but with additional sites in its home state and also in New South Wales.

This is the third investment from Advent's sixth fund, which reached a final close of approximately A$200 million in July 2013. Advent targets mid-market firms in Australia and New Zealand with enterprise valuations of A$20-150 million and annual profit in excess of A$5 million. Equity checks fall within the A$5-60 million range, although the firm has formed syndicates that have committed up to A$100 million.

The PE firm has previously invested in healthcare players such as Primary Healthcare, Benchmark Hospital Group, Cochlear and GenesisCare. The latter investment generated a 2.8x return over a three-year holding period with KKR completing a buyout of the business in July 2012.

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• Topics
• Australasia
• Healthcare
• Expansion
• M&A
• healthcare
• Australia
• Advent Private Capital
• Growth capital