It’s right up there amongst the very biggest of Northern Ireland’s corporate deals over recent years. The majority stake in Kingsbridge Private Healthcare Group acquired by London private equity firm Exponent for a reported £300 million.
The deal, which will allow Kingsbridge to ramp up its investment in the private healthcare sector across the island of Ireland, is a testament to the vision of the group’s founders, Northern Ireland-based doctors Suresh Tharma and Ashok Songra, and to a management team led by Chief Executive Mark Regan.
But if there is one man in the Kingsbridge camp who has lived, breathed and delivered the headline-grabbing deal, it’s Chief Financial Officer Jeremy Macartney.
“It’s been a bit intense at times. It’s been a long, drawn-out process and, to tell the truth, it’s been exhausting. But, given the end result, it’s also been well worth it,” he says.
Jeremy Macartney isn’t alone amongst CFOs and Finance Directors in preferring to keep a low profile, leaving the limelight to others. But, such was his part in the Exponent deal that his colleagues are making sure he gets the unwanted credit that he deserves.
First the facts and figures. Exponent, led by Belfast-born Managing Partner Richard Lenane, has taken a majority shareholding in the Kingsbridge Group, founded by Tharma and Songra in 2005 and now with four hospital sites and 11 clinics in Belfast, Ballykelly and Sligo. It employs more than 1,100 staff and uses the services of some 400 consultants, carrying out some 25,000 surgical treatments each year.
In a major vote of confidence, Exponent is to retain not just the entire management team at Kingsbridge and has also insisted that both Suresh Tharma and Ashok Songra remain in place as executive directors for the next five years….the traditional lifespan of a private equity deal from investment to cash out.
“The whole process started way back in September of 2022 with a beauty parade of consultants who could advise on the right deal for us,” Jeremy Macartney explains. “In the end, we went with PwC London on the strength of the firm’s reach into the global market. In those early days, we weren’t sure if the deal would come from an international hospital group, or from private equity investment.
“So PwC started to stimulate interest from those sectors while I had the job of working on the business plans and preparing the all-important Information Memorandum….a formal name for a document that provides an comprehensive overview of the business to prospective investors.”
By Christmas and early January, the process had moved on to the Fireside Chat stage. That’s a cosy, American-style name for a series of informal meetings with potential investors.
“It might sound informal, but it’s anything but. And there weren’t many firesides involved,” smiles Jeremy Macartney. “It meant Mark Regan and I shuttling back and forth to London and meeting with a series of parties, 17 of them all in all. That’s a lot of meetings. We had to be prepared, we had to work as a team and we even got into a bit of a routine….working to a script as much as possible. We had to become a double act.”
Following on from the London fireside chats, there were presentations to bankers – never easy in any circumstances – and then what Jeremy Macartney reckons was the easiest and most relaxed stage of all, the site visits to Kingsbridge by the final shortlist of potential investors.
“It was easier because we’re very proud of our facilities and we’re very proud of our people. So we were confident and relaxed when it came to showing people around the group. Most of them couldn’t understand how we were achieving such a high level of operating efficiency and generating such revenue from our facilities.
“We are ahead across a range of operational, quality and financial metrics – all evidence that we’re punching above our weight in the international arena.”
Cutting a potentially long story short, Exponent came out as the preferred bidders. But, even then, the long hours and hard work weren’t over. “We moved into what’s known as the vendor diligence phase, and things didn’t get any easier. That’s also a time consuming process.”
“All in all,” he says, “it’s been a gruelling process but made easier by the huge support and effort by the senior management team and my own finance team. I remember sitting here (the boardroom at Kingbridge Group’s Danesfort headquarters) looking up a no less than 32 faces on the screen, each one of them eager to ask questions. Never mind anything else, I was wondering how much it was costing us…..”
Jeremy Macartney, interestingly, didn’t start out as a money man. He graduated as an engineer from Edinburgh University before changing tack and re-training as a chartered accountant with the then Coopers & Lybrand, now, of course, part of the modern day PwC.
“There’s a retaining wall somewhere in Scotland that had a little bit of my input as a graduate engineer but I soon realised that it wasn’t for me.” He went on to work in industry with Belfast City Airport, at textiles firm Moygashel and with food processors O’Kane Poultry before arriving at 3FiveTwo and subsequently Kingsbridge Group.
Strictly speaking, this is not Kingsbridge’s first private equity deal. Back in 2018, Foresight Group and US fund 57 Stars invested in what was then 3FiveTwo Group, but on a considerably smaller scale.
As for Exponent, they’re a leading private equity player concentrating on companies with a turnover over between £150 million and £500 million with 40 or so live investments and £2.9 billion in funds raised.
Aside from Richard Lenane, Dublin-born David McGovern is a key player in the Kingsbridge deal, so there’s a strong Irish connection. Exponent’s other investments include travel booking site Trainline, online greeting card specialists Moonpig, Galway-based Chanelle Pharma, vegetarian and vegan product manufacturers Quorn and handbag brand Radley London. A typical equity finance eclectic mix.
“We’ve had lots of engagement with Exponent leading up to completion, but haven’t yet had our first board meeting. We fully expect the senior management team to continue to drive the business forward and deliver the initial projects highighted in our business plan.
“There’s no doubt that Exponent will push us to keep up the kind of pace that we’ve been setting over recent years. We’ve invested around £34 million over past three to four years.”
Key developments have included the opening of Kingsbridge’s impressive new Diagnostic & Treatment Centre in the new King’s Hall Health & Wellbeing Park. The next major development on the agenda is potentially in Sligo, where the Group plans a new and much larger hospital on the existing side in the town.
Best known as a private healthcare provider, Kingsbridge also ranks as the largest provider of medical services to the NHS and continues to treat an increasing number of patients from every county in the Republic of Ireland through the National Treatment Purchase Fund, set up by the Irish Government to help reduce hospital waiting lists.
“At one stage, 85% of our patients were coming from the public sector, but now it sits at 60% private patients. Diversity of payer groups and investment in our facilities have been key factors for the Group in the last five years. Our payer groups add balance and stability to the Group’s income streams.
“So things are looking good. But, as anyone in business knows, it’s when things aren’t going well that you earn your colours. That goes for the founders and the entire management team here,” says Jeremy Macartney.
“We’ve put our heart and soul into this deal, but then again, we’ve all put our hearts and souls into the growth of this business.”