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Franklin Square Provides $52.5MM to National Surgical Healthcare

June 09, 2015, 07:18 AM
Filed Under: Healthcare

Franklin Square Capital Partners announced the origination by three of its BDCs of a $52.5 million second lien senior secured note to National Surgical Healthcare (NSH), a leading owner and operator of surgical hospitals and ambulatory surgery centers in the United States. NSH is a portfolio company of Irving Place Capital (IPC), a New York, NY based private equity firm focused on buyout and growth capital investments across the middle market.

The financing was provided by FS Investment Corporation FSIC, -0.76% FS Investment Corporation II (FSIC II) and FS Investment Corporation III (FSIC III), BDCs managed by affiliates of Franklin Square and sub-advised by an affiliate of GSO Capital Partners LP (GSO). The financing supports NSH's acquisition of a majority interest in Optim Healthcare, a physician led provider of general and specialty healthcare services. The transaction also supports NSH's acquisition of additional equity ownership in one of its existing surgical facilities.

"The lending capacity across our BDCs makes it possible to tailor financing for strong middle market companies like National Surgical Healthcare," said Michael C. Forman, Chairman and Chief Executive Officer of FSIC, FSIC II and FSIC III. "We are pleased to work with Irving Place Capital to support NSH's growth."

"NSH exhibits consistent revenue growth, strong free cash flow characteristics and clinical excellence," commented Brad Marshall, Senior Managing Director at GSO and the senior portfolio manager of FSIC, FSIC II and FSIC III. "We believe that given its unique operating model focused on non-emergency scheduled procedures, combined with exceptional patient outcomes, the company is well positioned to further expand its healthcare footprint."

"The continued support of IPC combined with the certainty of execution provided by Franklin Square's funds will be instrumental in achieving our growth strategy of partnering with surgical facilities with a strong market presence," said David Crane, Chairman and Chief Executive Officer of National Surgical Healthcare.

Franklin Square is a leading manager of alternative investment funds designed to enhance investors' portfolios by providing access to asset classes, strategies and asset managers that typically have been available to only the largest institutional investors. The firm's funds offer "endowment-style" investment strategies that help construct diversified portfolios and manage risk.

NSH is an innovative healthcare partner, based in Chicago, Illinois, that empowers physicians to thrive in a changing marketplace. A leader in clinical outcomes, NSH partners with leading orthopedic surgeons and neurosurgeons in its facilities across the country to provide cost-efficient, high-quality patient care. NSH is an Irving Place Capital portfolio company.

Based in New York City, IPC is a middle-market private equity firm that invests in buyouts, recapitalizations, and growth capital opportunities. The firm focuses on making control or entrepreneur-driven investments in retail and consumer, industrial and packaging companies where it can apply its substantial operating and strategic resources and expertise to enhance value. Since its formation in 1997, IPC has been an investor in 60 companies and has raised over $4 billion of equity capital.

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