CDPQ, Centerbridge buy Medical Solutions for piece of $20 billion-plus U.S. healthcare staffing market

Caisse de dépôt et placement du Québec (CDPQ) and funds advised by Centerbridge Partners entered into a definitive agreement to purchase Medical Solutions from TPG Growth for an undisclosed amount.

Based in Omaha, Nebraska, Medical Solutions was launched in 2001 and has leveraged backing from various private equity players to grow into one of the largest providers of healthcare staffing, travel nurses and allied healthcare professionals in the U.S.

In June 2012, New York-based Tenex Capital Management joined with McCarthy Capital Fund V to acquire a majority interest in Medical Solutions, recapitalizing the firm and adding a board of directors. In 2013 they grew the firm by acquiring and merging with On Assignment’s Travel Nursing division, and two years later they cashed out with a sale to Beecken Petty O’Keefe & Company (BPOC), a Chicago-based investor with a focus on staffing and three other healthcare segments.

In May 2017, TPG Growth, the middle market and growth equity platform of alternative asset firm TPG, acquired a majority interest in Medical Solutions, with BPOC retaining a stake. Under TPG Growth’s wing, the firm executed the acquisitions of Talent Management Group and C&A Industries, parent company to four workforce solution firms.

The values of all transactions listed above were undisclosed.

The growth left the company well-poised to benefit from the medical staffing needs driven by the COVID-19 pandemic; last year Medical Solutions deployed clinicians to more than 4,500 healthcare facilities in all U.S. states.

“We are incredibly proud to have partnered with [Medical Solutions CEO] Craig [Meier] to establish a world class team and execute on our vision for Medical Solutions,” said Matt Hobart, co-managing partner of TPG Growth.

“With the support and expertise of Centerbridge and CDPQ, we will be even better positioned to help meet the increased need for skilled healthcare professionals and talent management nationwide,” said Meier.

A recent Staffing Industry Analysts report estimates the U.S. temporary staffing healthcare market grew 8% last year to $19.9 billion and it is expected to grow 7% to $21.3 billion this year, while Grand View Market Research valued the market at $17 billion in 2019 and estimated it would expand at a compound annual growth rate of about 5% per year through 2027.

“We are pleased to support the next phase of its expansion and help Medical Solutions meet the evolving needs of healthcare facilities across the United States,” said Martin Laguerre, executive vice-president and head of Private Equity and Capital Solutions at the C$333 billion ($254 billion) Canadian pension CDPQ.

Medical Solutions’ “mission has become even more essential during a global pandemic that is causing higher levels of burnout and lower morale for the country’s clinical workforce,” said Jeremy Gelber, senior managing director, and Miriam Tawil, managing director, of Centerbridge Partners, a New York-based firm with more than $24 billion in AUM. “We look forward to working with Craig and the team in partnering with health systems to solve the supply and demand imbalances for nurses and allied health professionals through next generation solutions to improve capabilities around clinician recruitment, retention and training.”

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