Welsh, Carlson, Anderson & Stowe (WCAS) is a private equity
firm focusing primarily on the industries of health care and
technology. It is one of the oldest and the largest firms in
the United States and has raised capital for more than 15 limited
partnerships with a cumulative value of more than $20
billion. WCAS is a leader in the niche it has carved out for
itself, since its inception, it has invested in more than 150
companies including Alliance Data, SunGard Data Systems, Accuro
Health, Lincare Holdings, MedCath and Fiserv.
The company's portfolio consists of 32 companies with revenue of
more than $29 billion. WCAS' 11th private equity fund, WCAS
XI, was valued at about $3.7 billion by the time it closed in June
2009. WCAS is ranked No. 40 in Private Equity
International's list of 300 largest private equity firms in
the world for 2009.
One of WCAS' acquisitions is United Surgical Partners, a health
care company that runs short-stay surgery centers, which is
purchased in 2007 for $1.8 billion. As one of its founding
shareholders, WCAS has had a long relationship with United
Surgical. The company's main operations are specialized
outpatient procedures, which are outsourced from general-service
hospitals at a lower cost.
In the first half of 2008, WCAS added two companies to its
portfolio. In the technology sector, the company recently
invested in Mini Mobile, a provider of mobile storage
solutions. In the health care sector, WCAS acquired Med
Assets, a public company provides "technology-enabled products and
services that improve operating margin and cash flow for hospitals
and health systems."
"Delighted with the credit crunch"
In the wake of the subprime mortgage fallout, financing has dried
up for many private equity firms. However, WCAS was not
worried about the credit crisis. In fact, at the 2008 Wharton
Private Equity Conference, WCAS Partner Sean Traynor laid out how
turmoil in the markets might actually be advantageous for
middle-market investment firms. "We're delighted with the
credit crunch. Despite what's going on with the market and
the economy, a lot of the businesses that we look at are still very
good businesses. There will be opportunities, certainly, in a
distressed world, and recessions don't last forever." Traynor
went on to explain that a lack of frenzy for acquisitions gives
firms a better chance to research their potential buys, saying,
"The greater appetite from lenders for due diligence gives us more
time to evaluate deals. If we have time to do our work, I'm
confident that we'll make a good decision."