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KKR to acquire Covenant Surgical Partners

KKR is acquiring Covenant Surgical Partners (Covenant) from DFW Capital Partners, Iroquois Capital Group, PineBridge Investments, and other existing shareholders. Financial details of the transaction have not been disclosed.

Covenant is a leading acquirer and operator of ambulatory surgery centres (ASCs) and physician practices. The Company currently provides gastrointestinal and ophthalmic procedures through 37 ASC and physician practice locations across 17 states. Covenant works in partnership with its affiliated physicians to provide value added financial, operational, and ancillary services to enhance business and clinical operations.
“This transaction marks the next stage of Covenant’s evolution,” says Lew Little, Chief Executive Officer of Covenant. “This is the second time I’ve had the opportunity to work with KKR. Having seen firsthand what their partnership and resources can contribute to a company, I am thrilled to welcome them to the Covenant family and together accelerate our future growth.”
“Covenant provides an important role in improving patient access and reducing costs for the health care system. We look forward to partnering with Covenant in building a premier professional services organisation to support its affiliated surgery centres and physician practices,” says Jim Momtazee, Head of KKR’s Health Care investment team.
“It has been a privilege to partner with the Covenant team in building one of the premier ambulatory surgery platforms and physician services companies in the nation,” says Keith Pennell, Managing Partner at DFW Capital Partners.
The transaction, which is subject to regulatory approvals and other customary closing conditions, is expected to close in the third quarter of 2017. KKR is making its investment primarily through its KKR Americas XII Fund.
Piper Jaffray & Co acted as exclusive financial advisor and Ice Miller LLP acted as legal advisor to Covenant. Simpson Thacher & Bartlett LLP served as legal counsel to KKR. Fully committed debt financing will be provided by Goldman Sachs and KKR Capital Markets.

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