Affinity Equity Partners is to acquire Lumus Imaging from Helius (ASX: HLS) in a deal that values the business at $965 million.
The deal will end an auction process which followed Helius announcing in March that it had decided to divest Lumus. Healius (formerly Primary Health Care) plans to focus on its core pathology business.
The cash, debt and equipment-lease free transaction remains subject to conditions including Foreign Investment Review Board (FIRB) approval.
Asian regional private equity firm Affinity will acquire Lumus without debt funding. On a pre-AASB16 basis, the transaction represents a 17x multiple to financial year 2024 earnings before interest, tax, depreciation and amortisation (EBITDA) and a 25.4x multiple to earnings before interest and tax (EBIT).
Lumus Imaging operates from about 150 sites nationally. Including independent radiologists, the business employs around 2,000 people.
Affinity Sydney-based managing director Mark Chudek said: “Lumus Imaging is an exceptional business which aligns to Affinity’s commitment of investing in high-quality companies that have significant growth potential.
“Healthcare is a key investment area for Affinity, and we aim to support companies with the resources they need to expand, serve more patients and deliver improved services to all stakeholders – including Lumus Imaging’s referrers and hospital clients.”
Chudek said Affinity planned to invest further in Lumus to help drive its growth as a standalone entity and regarded the transaction as entering into a partnership with Lumus’ doctors, other healthcare professionals, support staff and management team.
Affinity’s financial adviser on the Lumus acquisition was UBS Securities Australia. Herbert Smith Freehills provided legal advice.
The Lumus investment is Affinity’s first since it recruited former Riverside Australia partner Nick Speer as head of its Australian office early last year. Chudek was also re-hired last year after a stint with Quadrant Private Equity.
Affinity has invested in Lumus out of its 2017 vintage $US6 billion ($A8.81 million) Fund V.
Affinity previously invested in the healthcare sector in Australia in medical practices management software business MedicalDirector. That business was bought from Primary Healthcare in 2016 for $155 million in a deal led by Chudek. MedicalDirector was exited to the healthcare technology business of Telstra (ASX: TLS) in 2021 in a deal which was believed to have valued the business at about $350 million. That exit was led by Sam Johnson who left Affinity in 2022.
Image: Lumus Imaging operates from about 150 sites nationally.