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Onex Corp. CEO Gerry Schwartz has snapped up a British health care staffing firm, just weeks after telling backers his company saw opportunities to make acquisitions at bargain prices during the pandemic.

One of Canada’s largest asset managers, Onex announced plans on Thursday to acquire Independent Clinical Services Group Ltd. (ICS). The London-based company with 1,850-employees provides doctors, nurses, technicians and management systems to hospitals and agencies in 10 countries on four continents.

Nigel Wright, Onex’s U.K.-based managing director, said in a release: “ICS is committed to being a true partner to its clients in delivering both capacity and care at the highest standard, and that is a commitment we want to continue and build on.”

Toronto-based Onex did not disclose financial terms of the deal. ICS’s current owner, British private-equity firm TowerBrook Capital Partners LP, put the business up for sale in February; media reports at the time valued ICS at $1.4-billion.

Analyst Scott Chan at Canaccord Genuity Corp. said: “We are encouraged by this investment that was executed in an extremely difficult market environment.”

ICS is comparable to a U.S. rival, the publicly traded AMN Healthcare Services Inc., which has a US$2.5-billion market capitalization. In recent presentations, the American firm said its industry is fragmented and ripe for consolidation. AMN Healthcare reported 16 per cent annual sales growth over the past five years, along with 25-per-cent growth in cash flow and 30-per-cent-plus profit margins.

onex buys independent

clinical services

Onex is buying British health care company

Independent Clinical Services Group, with 1,850

employees covering 2,000 clients from offices

in 10 countries.

Worldwide

Independent

Clinical Services

Group locations

Britain and Ireland

Main

office:

London

Edinburgh

Belfast

Dublin

Stockholm

Beijing

Frankfurt

Chicago

Basel

San Franciso

Tokyo

Shanghai

Singapore

Sydney

JOHN SOPINSKI/THE GLOBE AND MAIL, SOURCE:

independent clinical services group

onex buys independent clinical services

Onex is buying British health care company Independent

Clinical Services Group, with 1,850 employees covering

2,000 clients from offices in 10 countries.

Worldwide

Independent

Clinical Services

Group locations

Britain and Ireland

Main

office:

London

Edinburgh

Belfast

Dublin

Stockholm

Frankfurt

Beijing

Chicago

Basel

Tokyo

San Franciso

Shanghai

Singapore

Sydney

JOHN SOPINSKI/THE GLOBE AND MAIL, SOURCE: independent

clinical services group

onex buys independent clinical services

Onex is buying British health care company Independent Clinical Services Group,

with 1,850 employees covering 2,000 clients from offices in 10 countries.

Stockholm

Frankfurt

Beijing

Chicago

Basel

San Franciso

Tokyo

Shanghai

Britain and Ireland

Main

office:

London

Singapore

Edinburgh

Belfast

Sydney

Dublin

Worldwide Independent Clinical Services Group locations

JOHN SOPINSKI/THE GLOBE AND MAIL, SOURCE: independent clinical services group

As part of Onex’s acquisition, TowerBrook will continue as a minority owner and reinvest part of the capital it receives back into ICS. Founded by former colleagues of hedge-fund guru George Soros, TowerBrook acquired ICS in 2014 from yet another private-equity fund, Blackstone Group Inc.

The ICS acquisition is the first major deal for a Canadian private-equity investor since the COVID-19 pandemic rocked capital markets. The purchase comes three weeks after Mr. Schwartz, Onex’s founder, opened a letter to shareholders by noting the company is occasionally criticized for holding significant cash reserves, with approximately $2.8-billion on hand in March. Mr. Schwartz said: “With the current crisis, though, its purpose should be clear. It ensures that we can continue investing through good and bad times.”

Since COVID-19 changed the way business is conducted, private-equity funds have focused on putting more capital into their existing investments, or making what are known as “bolt-on” acquisitions that add a small business to a company already in their portfolio.

For example, last month the Ontario Teachers’ Pension Plan bought out one of two Australian partners in the Sydney Desalination Plant, moving to a 60-per-cent interest in the project. The facility can supply 15 per cent of the drinking water to Australia’s largest city, and is in the midst of a $1.1-billion expansion. Toronto-based Teachers first acquired a stake in the plant in 2012 as part of a $2.3-billion government asset sale.

Ironbridge Equity Partners made a bolt-on acquisition last week, expanding its recreational boating business by backing Vancouver-based CMP Group Ltd, a company it has owned for two years, in CMP’s purchase of a Minnesota-based maker of fish trolling motors called MarineTech Products Inc. Toronto-based Ironbridge did not disclose the value of the transaction.

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