Anesthesia: CRH Medical Corporation Acquisition
CRH Medical Corporation announced it was being acquired by Well Health Technologies Corp. on February 8, 2021 for $4 per share, implying a total enterprise value of approximately $369.2m. CRH rolls up small anesthesia providers that exclusively serve endoscopy centers across the United States through long-term (5-7 year) contracts. While CRH is relatively diversified at this stage in its development, its largest customer, United Digestive fka Atlanta Gastroenterology Associates, informed the company in late 2020 that it did not intend to renew its contract set to expire October 31, 2021. AGA was CRH's first client through its 2014 acquisition of Gastroenterology Anesthesia Associates from AGA for $73.2m or ~4.6x EBITDA of $16m - a multiple that implies that AGA may never have intended to renew after expiration of the original 7-year contract. The fairness opinion prepared in connection with the Well Health acquisition includes EBITDA estimates with and without the United Digestive business.
The ~11x EBITDA multiple without UD is just slightly lower than the multiples from the 2016 North American Partners in Anesthesia and the 2014 Sheridan Healthcare deals.