(New York, NY) – Cortec Group (“Cortec”), a New York private equity firm which invests in middle market healthcare, consumer, and specialty products, service and distribution businesses, announced that on November 12, 2013, a group led by its affiliate, Cortec Group Fund V, L.P. (“Cortec Fund V”), acquired Canadian Hospital Specialties ULC (“CHS” or the “Company”). Investing alongside Cortec Fund V are David, Thomas, Gary and Brian Enns, whose father founded the business in 1967, and other key members of the Company’s senior leadership team. Terms of the transaction were not disclosed.
Based in Oakville, Ontario, CHS manufactures, sells, markets and distributes disposable medical and surgical products primarily to the Canadian hospital market. CHS conducts its business through three key segments: (i) production and sale of its proprietary MED-RX branded products; (ii) exclusive sale and distribution in Canada of products supplied by global medical device manufacturers; and (iii) outsourced manufacturing of disposable medical products for OEM healthcare companies. The Company’s product portfolio is comprised of more than 5,000 highly clinical, “outcome-driven” products that are differentiated based on safety, quality, and customization for ease of use and include nursing and anesthesia procedure kits/trays, stents, enteral safe feeding systems, tracheal suction products, chest drains, gastrostomy tubes, needles, catheters, vascular grafts, among many others.
“The Company’s comprehensive and innovative portfolio of branded products and excellent customer service makes CHS a value-added partner for its customers, which has enabled it to secure leading market positions in a number of key Canadian hospital call points,” said Jeffrey A. Lipsitz, a Managing Partner at Cortec.
“As a result of the Company’s highly regarded reputation with hospital purchasing decision makers, we believe CHS is well positioned to continue to penetrate the Canadian hospital market and capitalize on favorable demographic and end market trends,” added Michael E. Najjar, a Partner at Cortec. “We look forward to working with David and the rest of the CHS team to achieve their growth objectives.”
David Enns, President and CEO, who will continue in his current position along with the rest of the Enns family, each of whom will remain a material shareholder, explained, “We were looking for a partner with healthcare investing experience and were impressed with Cortec’s successful track record of working with management teams to grow medical products and distribution businesses. We are confident that we have found a great partner with the capital, expertise and experience to support the Company’s plans to grow organically and through acquisition.”
TM Asante Healthcare Partners, the healthcare investment banking practice of TM Capital Corp., served as financial advisor to CHS.
The CHS acquisition represents Cortec Fund V’s fourth platform investment.
About Canadian Hospital Specialties ULC
Founded in 1967, CHS is a leading manufacturer, marketer, and distributor of disposable medical products to the Canadian hospital market. For additional information, please visit www.chsltd.com.
About Cortec
Founded in 1984, Cortec acquires high value-added, middle-market healthcare, consumer, and specialty products, service, and distribution businesses from owners and management teams who want to work with Cortec to drive growth and improve business fundamentals. Cortec currently manages over $1 billion in its two active funds and targets platform acquisitions with enterprise values of $40 million to $300 million and smaller follow-on acquisitions. Additional information about Cortec can be found at www.cortecgroup.com.
