Federal Street Acquisition Corp., Thomas H. Lee Partners, L.P. and Agiliti Health, Inc. Complete Business Combination

Saturday, Jan 05, 2019

Federal Street Acquisition Corp., a special-purpose acquisition company sponsored by an affiliate of Thomas H. Lee Partners, L.P. (“THL”), and Agiliti Holdco, Inc., the holding company of Agiliti Health, Inc. (“Agiliti Health”), a leading, nationwide provider of healthcare technology management and service solutions and a portfolio company of Irving Place Capital Management, L.P., announced today that they have completed their business combination. The transaction had been unanimously approved by the board of directors, including a special committee of independent directors of FSAC and was approved at a Special Meeting of FSAC’s stockholders on January 3, 2019. The implied enterprise value for the combined company is approximately $1.74 billion, or 11.6x Agiliti Health’s forecasted 2018 Adjusted EBITDA of approximately $150 million and 10.2x Agiliti Health’s forecasted 2019 Adjusted EBITDA of approximately $170 million.

In accordance with the terms of the merger agreement, FSAC and Agiliti Holdco, Inc. have combined under a new holding company, Agiliti, Inc. (“Agiliti”). Agiliti builds on a legacy of nearly 80 years of market-leading healthcare technology and service solutions to the U.S. healthcare industry, serving approximately 7,000 national, regional and local acute care hospitals and alternate site providers across the country.

Upon completion of the transaction, Agiliti will be majority owned by entities affiliated with THL and management. The company will continue to be led by Thomas J. Leonard as Chief Executive Officer, along with his current management team.

Scott M. Sperling, Co-President of THL and Executive Chairman of the board of directors of FSAC stated, “We are extremely proud to join forces with Agiliti. The company is well positioned to drive shareholder value by helping health systems address their most complex medical equipment challenges throughout the entire supply chain.”

Joshua M. Nelson, a Managing Director at THL said, “As a market-leading, growth healthcare company operating in an industry with strong fundamentals, we are excited to support Agiliti with a $750 million backstop equity financing so it may complete the business combination. We look forward to working with Tom and the talented Agiliti team to further drive efficiencies for its health system clients, while building upon the company’s market-leading position and helping them achieve their substantial future growth prospects.”

Leonard added, “This transaction represents the next step in the evolution of Agiliti. As a well-capitalized company with new, experienced strategic partners, Agiliti will remain focused on innovating our suite of offerings and providing our clients with the best-in-class service they have come to expect from us. Our nationwide service platform, coupled with our unmatched offering for Equipment Value Management has enabled a flexible and scalable model to power our growth. I look forward to our continued advancement with the support of our partners at THL.”

As previously announced, FSAC and Agiliti have waived the closing condition under the merger agreement that would have required Agiliti’s common stock and warrants to be listed on the NASDAQ stock exchange. The common stock and warrants of Agiliti will not be listed at closing of the transaction.

In connection with the transaction, Citigroup Global Markets Inc. and BofA Merrill Lynch served as financial advisors and Kirkland & Ellis LLP served as legal advisor to FSAC, and Weil, Gotshal & Manges LLP served as legal advisor to Agiliti Health.



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