Unlocking Value and Navigating the Future: Agiliti's New Chapter with THL Partners

In an era where the healthcare industry is grappling with unprecedented challenges and complexities, the recent strategic moves by Agiliti, a prominent player in medical technology management and service solutions, underscore the transformative power of private equity in driving growth, innovation, and sustainable value creation in this vital sector. This development comes as Agiliti, a company that has long been at the forefront of providing critical support to the U.S. healthcare infrastructure, enters a definitive merger agreement with an affiliate of Thomas H. Lee Partners, L.P. (THL), a move that will see Agiliti transition to a privately held entity.

The importance of Agiliti's services in the healthcare landscape cannot be overstated. With solutions spanning medical equipment management to comprehensive service solutions, Agiliti has been instrumental in helping more than 10,000 healthcare providers across the U.S. reduce costs, increase operational efficiencies, and support optimal patient outcomes. This is more than just a business transaction; it's a pivotal moment that promises to fuel Agiliti's mission to support a more efficient, safe, and sustainable healthcare delivery system.

Under the terms of the agreement, THL, the company's majority shareholder, will acquire all outstanding shares of Agiliti common stock not currently owned by THL and its affiliates plus certain management shareholders for $10.00 per share in cash. This arrangement values the enterprise at approximately $2.5 billion and offers a premium of about 39% and 43% over Agiliti’s 30-day and 90-day volume weighted average price per share, respectively. Such a premium underscores the confidence in Agiliti’s strategic direction and the inherent value the company brings to the healthcare sector.

The merger is the culmination of a special committee review by the Agiliti Board of Directors, spotlighting a rigorous process dedicated to safeguarding shareholder interests. The committee, comprised solely of non-management directors not affiliated with THL, alongside independent legal and financial advisors, unanimously concluded that this transaction serves the best interests of Agiliti and its shareholders, barring THL and its associates. This level of due diligence reflects a commitment to transparency and shareholder value, ensuring that the decision to go private is not just strategic, but also equitable.

The CEO of Agiliti, Tom Leonard, highlights that this move is not just a transaction but a significant step towards expanding the partnership with THL, which has already seen a beneficial association over the past five years. Leonard emphasizes the transaction's role in delivering immediate value and liquidity to shareholders, alongside alleviating public market constraints, thereby setting the stage for enhanced performance and growth.

The transition to a privately held company is anticipated to complete in the first half of 2024, with THL Agiliti LLC, as the majority shareholder, approving the transaction. This marks a seminal moment for Agiliti, as it embarks on a new journey outside the public market's glare, promising agility, and a renewed focus on its core mission.

For the healthcare industry at large, Agiliti's next chapter under THL's stewardship is a testament to the critical role of private equity in fostering innovation, growth, and operational excellence. THL, with its extensive experience and successful track record in healthcare, financial technology & services, and technology & business solutions, is uniquely positioned to propel Agiliti towards greater heights. This partnership not only reflects a shared vision for the future of healthcare service provision but also underscores a commitment to building sustainable, long-term value.

In summary, the merger between Agiliti and an affiliate of THL Partners is more than a business transaction; it's a strategic move that promises to reshape the landscape of healthcare service delivery. As Agiliti embarks on this new chapter, the focus remains steadfast on leveraging advanced solutions to support a more efficient and sustainable healthcare system. For stakeholders across the board, this development not only highlights the potential for significant value creation but also the importance of strategic partnerships in navigating the complexities of the modern healthcare industry. The future of healthcare looks promising, with innovative solutions and strategic collaborations paving the way for enhanced patient care and operational efficiency.