According to a filing with the Federal Trade Commission and a report by Moody’s Investor Services, Mitt Romney’s old asset management and financial service company Bain Capital is purchasing the established air ambulance service REACH that operates in Texas, California, and Oregon.
Air Medical Group Holdings Inc., which was bought by Romney’s old investment firm and became its subsidiary in 2010, will take on roughly $250 million in debt in order to fund the acquisition.
According to a report on the Dow Jones LBO Wire, experts expect the purchase to increase Air Medical Group Holdings Inc.’s debt-to-earnings before interest taxation depreciation and amortization to between 6 times and 6.3 times, up from 5.8 times. However, they also predict that that ratio will fall under 6 times debt to Ebitda in the next 12 to 18 months “due to anticipated continued growth.”
According to their web site, the Federal Trade Commission has confirmed that anti-trust authorities have already cleared the $250 million business transaction.
The sale of the air ambulance service had been rumored to occur for some time according to another report.
That source also claimed that some around the airport where REACH air ambulance is based had been speculating for a period of time that “buyers with deep-pockets” could swoop in and purchase new equipment for the service.
A few locals in the Redwood Empire region of northern California had initial reservations about the homegrown air ambulance service being acquired by an outside entity, such as Bain Capital, without “roots” in the area.
With the transaction still taking place it, of course, remains to be seen exactly what — if anything — will change now that the service has been bought by Air Medical Group.
About Air Medical Group Holdings
The aptly-named Air Medical Group is a giant in the air medical industry, boasting an impressive fleet of over 200 rotor-wing and fixed-wing aircraft based in 27 states.
According to a report cited by Moody’s, Air Medical Group reported revenue of $441 million in the 12 months ending June 30, 2012.
Bain Capital bought Air Medical Group Holdings for approximately $1 billion back in 2010.
Air Medical Group conducts operations through three subsidiary air ambulance companies: Air Evac Lifeteam, in West Plains, Missouri, Med-Trans Corporation, in Dallas, Texas, and EagleMed, in Wichita, Kansas.
The REACH (Redwood Empire Air Care Helicopter) air ambulance service was founded in 1987 by E.R. doctor John McDonald.
McDonald, who died in an airplane crash in 2000 had begun the service with the initiative of extending emergency air transport to people in remote areas of the North Coast of California (also known as the Redwood Empire).
2012 marks the 25th year anniversary for REACH Air Medical Services. Since the service first took off in 1987, the company has expanded to a total of 12 bases covering areas of California, Oregon, and Texas.
They provide air medical flights for critically-injured patients with a sizable fleet of 17 rotor-wing and 3 fixed-wing air ambulances.