Target Company Information

Medizintechnik Rostock GmbH (MTR) is a prominent home care provider based in Germany, specializing in medical therapy devices for at-home use. Founded in 1994, the company currently employs around 200 individuals and has established partnerships with over 80 health insurance companies. MTR performed more than 140,000 therapy fittings in 2023 across various therapeutic areas, including movement, electro, and compression therapy.

MTR's product offerings are particularly effective in facilitating recovery for patients post-surgery. Its continuous passive motion (CPM) devices are primarily utilized for restoring joint mobility after orthopedic procedures, while electrotherapy devices provide muscle stimulation and pain relief. Additionally, MTR's compression therapy devices address lymphoedema and venous issues by enhancing circulation through intermittent pneumatic compression.

Industry Overview in Germany

The home healthcare industry in Germany is experiencing significant growth, driven by an aging population and an increasing incidence of chronic illnesses. In Germany, healthcare providers are increasingly looking towards innovative and patient-centered solutions, making home care services highly relevant. MTR stands at the forefront of this evolution, positioning itself as a trusted partner for patients and healthcare providers alike.

The regulatory landscape in Germany mandates that health insurance companies cover the costs of essential therapy devices prescribed by physicians, thus facilitating greater patient access to necessary medical interventions. This environment bolsters MTR's capabilities to provide high-quality service under a rental model, ensuring that patients receive the necessary equipment during their rehabilitation period.

In recent years, the integration of technology in healthcare delivery has opened new avenues for service enhancement. Companies like MTR harness this potential by investing in proprietary software and training programs, which strengthen patient support and device usage adherence. As competitive pressures increase, leading firms are mandated to continuously enhance their service offerings to maintain their competitive edge.

Furthermore, the global shift towards home-based care solutions is fueled by advancements in medical technology, enabling patients to receive quality care in their own homes. This trend presents substantial growth opportunities for providers specializing in medical therapy devices, paving the way for innovative business models and service expansions in the home care sector.

Deal Rationale

SHS Capital's acquisition of a majority stake in MTR aims to foster growth in the core business and support the company's ongoing nationwide expansion efforts. The partnership is designed to leverage SHS's expertise and network in the healthcare sector, enabling MTR to enhance its patient care services further and explore new market opportunities.

The continuity of MTR's existing leadership is a strategic asset in this investment. The two shareholders and managing directors retain a significant shareholding, ensuring their invaluable insights and operational knowledge are maintained, thus promoting a smooth transition post-acquisition.

Investor Information

SHS Gesellschaft für Beteiligungsmanagement mbH, commonly known as SHS Capital, is a private equity firm established in 1993, focusing predominantly on healthcare investments in Europe. The firm is committed to supporting expansion financing, shareholder transitions, and succession issues within the healthcare sector. Operating under the philosophy of “Building European Healthcare Champions,” SHS Capital invests strategically in both minority and majority stakes, with a current sixth fund volume of approximately €270 million.

The firm employs a rigorous investment model that prioritizes Environmental, Social, and Governance (ESG) aspects, aligning with UN PRI guidelines. SHS Capital’s diverse investor base includes pension funds, family offices, and strategic investors, all contributing to its broad operational reach in the healthcare domain.

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The strategic acquisition of MTR by SHS Capital appears to be a promising investment opportunity. With MTR’s established reputation and commitment to high-quality patient care, coupled with SHS's proven experience in scaling healthcare ventures, the groundwork is set for mutual success. The continuous demand for at-home medical therapy devices, driven by an aging population and an emphasis on non-institutional care, augments the investment's attractiveness.

Furthermore, the retention of MTR’s managing directors provides an essential stability that is often overlooked during acquisitions. This leadership continuity is likely to facilitate a smoother integration process and sustain MTR's operational excellence, which is critical in a competitive healthcare environment.

Considering SHS Capital's expertise in the healthcare sector, alongside its robust strategic framework for growth, the collaboration is well-positioned to enhance MTR’s offerings and expand its reach. This investment aligns with significant market trends favoring home care solutions and stands to improve patient outcomes substantially.

In conclusion, this acquisition not only positions SHS Capital to realize strong returns but also enhances MTR's capability to deliver exceptional patient care—a win-win scenario for all stakeholders involved.

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