O’Melveny Assists Kayne Partners in Consecutive Healthcare IT ExitsApril 21, 2021
FOR IMMEDIATE RELEASE
CENTURY CITY—April 21, 2020—O’Melveny advised client Kayne Partners, the growth equity strategy of Kayne Anderson Capital Advisors, L.P. in two consecutive healthcare IT exits.
In the first deal, O’Melveny advised Kayne Partners’ portfolio company rfXcel Corporation, a global leader in digital supply chain traceability solutions, in its acquisition by Antares Vision Group. Headquartered in Reno, Nevada, rfXcel provides leading-edge software solutions to help companies build and manage their digital supply chain, lower costs, and protect their products and brand reputation. Antares is an Italy-based global provider of intelligent track & trace, inspection and smart data management solutions for the life science and food & beverage sectors. The transaction closed March 31, 2021.
In the second transaction, O’Melveny advised Kayne Partners in its exit from portfolio company Azalea Health Innovations, Inc. Azalea is a tech-enabled revenue cycle management (RCM) and cloud-based electronic health record (EHR) software provider, for the rural healthcare market.
Kayne Partners, the Los Angeles-based dedicated growth private equity group of Kayne Anderson Capital Advisors, L.P., is a leading provider of capital and connections to privately held, high growth, enterprise software and tech-enabled service businesses in North America.
O’Melveny corporate partner David Smith, based in the firm’s Century City office, led the firm’s work on these matters with assistance from corporate counsel Shawmir Naeem, and associates Cliff “Yinan” Wen and Dylan Towns.
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Kayne Partners issued the following press release via Business Wire:
For Immediate Release:
Kayne Partners Continues Successful Track Record of Building Must-Have Assets in Healthcare IT for Both Strategics and Financial Sponsors
rfXcel Corporation Acquired by the Antares Vision Group and Azalea Health Receives Majority Investment From LLR Partners
LOS ANGELES--(BUSINESS WIRE)--Kayne Partners, the growth equity strategy of Kayne Anderson Capital Advisors, L.P. (“Kayne” or the “Firm”), a leading alternative asset management firm with over $33 billion under management (as of 2/28/2021), is pleased to announce it has successfully exited rfXcel Corporation (“rfXcel”), a SaaS-based track and trace software provider to the food and life sciences sectors. This follows the recent recapitalization of Azalea Health Innovations, Inc. (“Azalea”), a tech-enabled revenue cycle management (“RCM”) and cloud-based electronic health record (“EHR”) software provider, for the rural healthcare market.
Founded in 2003 by Glenn Abood and Jack Tarkoff, rfXcel is a pure play software provider to the global food and life sciences sectors, offering SaaS-based track & trace solutions that improve safety, enable regulatory compliance and deliver real-time business insights. The company provides supply chain digitalization and transparency through a comprehensive, data driven offering that includes traceability, serialization, compliance management and integrated monitoring. rfXcel is one of the largest players in the market with a global presence in 40 countries, a diversified customer base of more than 190 clients and thousands of partners across the life sciences, food & beverage and public sectors. rfXcel was acquired by the Antares Vision Group (“Antares”; BIT (Italian Stock Exchange) which closed its previously announced acquisition of rfXcel.
“Our investment in rfXcel represents our long-standing view that the lack of transparency within global supply chains has created significant industry-wide challenges, particularly in the life science and food distribution sectors. The potential for counterfeiting and contamination of critical assets, such as pharmaceutical drugs, can lead to consumer illness or death, and the financial liabilities to the manufacturers and those in their ecosystem can be significant. We identified rfXcel as an industry leader solving these major pain points for their customers, sitting at a cross-section of industry theses we had within healthcare IT, supply chain, and compliance,” said Leon Chen, Managing Partner of Kayne Partners.
“Our partnership with the team at Kayne Partners allowed us to leverage Kayne's extensive network and breadth of resources, which proved critical in helping transform rfXcel from an emerging software business to a recognized market leader in the industry," stated Glenn Abood, CEO of rfXcel. “The access we were provided for high quality talent, partnerships, and business development opportunities, coupled with the guidance from Kayne Partners, was instrumental in helping us achieve the successful outcome of this acquisition.”
Kayne Partners portfolio company, Azalea, also recently announced a recapitalization and the close of a majority financing by LLR Partners, a lower middle market private equity firm focused on the technology and healthcare sectors. With this recapitalization, Kayne Partners has fully exited its investment in Azalea.
Founded by Baha Zeidan, CEO, Doug Swords, Vice President of Revenue Cycle Management, and Dan Henry, Vice President of Infrastructure & Security, Azalea connects community-based healthcare providers and patients across the care continuum in a seamless manner with its modern workflow and robust API integration capabilities. Its cloud-based solution delivers electronic health records, revenue cycle management, and a fully integrated telehealth solution designed for rural, community and urban practices and hospitals, especially those serving underserved populations.
Azalea partnered with Kayne Partners in 2016 to accelerate its goal of helping understaffed, rural healthcare providers improve revenue, reduce costs, and drive better outcomes in the wake of the Centers for Medicare & Medicaid Services (“CMS”) implementing wide-spread government regulations requiring hospital systems to adopt EHR systems to improve access to complete and accurate information and higher quality health care.
“At the time we invested, we saw that the rural healthcare market had lagged behind resource-rich urban environments regarding the adoption of EHR and RCM technologies, creating an opportunity for Azalea to help providers and health systems drive efficiencies and adapt to regulatory changes,” said Managing Partner & Co-Head of Growth Equity, Nishita Cummings. “It has been a privilege to work with Baha Zeidan, CEO and Founder of Azalea, and his entire team to help build and institutionalize this platform which is exceptionally well-positioned to continue its growth trajectory.”
“Kayne Partners has been a terrific partner through our journey together. From the time Kayne initially invested, the team was invaluable in helping us attract new talent, refine our internal processes and enhance our value proposition to our customers. They played a key role in helping us identify acquisition targets and worked with us all the way through the final stages of the acquisitions that contributed to geographic and product expansion. Nishita and the Kayne Partners team were true partners to Azalea, being by our side through opportunities and obstacles, and their leadership helped enable this great outcome for the company," said Baha Zeidan, CEO at Azalea.
About Kayne Partners
Kayne Partners, the Los Angeles-based dedicated growth private equity group of Kayne Anderson Capital Advisors, L.P., is a leading provider of capital and connections to privately held, high growth, enterprise software and tech-enabled service businesses in North America. Kayne Partners seeks to partner with driven entrepreneurs and provide capital to high growth companies at a transformative point in their life cycle in the following industries: media & telecommunications, supply chain & logistics, financial technology, healthcare IT, security & compliance, and business process outsourcing and automation. For more information, please visit www.kaynepartners.com.
About Kayne Anderson Capital Advisors
Kayne Anderson Capital Advisors, L.P., founded in 1984, is a leading alternative investment management firm focused on real estate, credit, infrastructure/energy, renewables, and growth equity. Kayne’s investment philosophy is to pursue niches, with an emphasis on cash flow, where our knowledge and sourcing advantages enable us to deliver above average, risk-adjusted investment returns. As responsible stewards of capital, Kayne’s philosophy extends to promoting responsible investment practices and sustainable business practices to create long-term value for our investors. Kayne manages over $33 billion in assets (as of 2/28/2021) for institutional investors, family offices, high net worth and retail clients and employs over 350 professionals in five core offices across the U.S.
For more information, please visit www.kaynecapital.com.