Maintaining Independence through Appropriate Strategic Partnerships

At the 2023 Ambulatory Surgery Center Association (ASCA) annual meeting, ASCs Inc’s Managing Partner Jim Freund and Executive Vice President Stephanie Tarry will be sharing their insights regarding how physician-owners of ASCs and Practices can realize exceptional outcomes with appropriate joint ventures.  

Question – What is a Strategic Partnership?

Answer – By definition, a strategic transaction is an event that defines the future direction of a business or organization. In this case it will involve an acquisition and joint venture and it is designed to deliver an outcome for ASC owners that enables them to realize their strategic vision and goals.  

Question – How do owners determine if this is the right time to consider a Strategic Partnership?

Answer – Physicians are constantly evaluating their business and making decisions regarding their future, this is part of being an owner of a Practice and/or ASC.  If you feel at any point that it may take a partner to help you realize your goals, then you should explore your options.  

Question – How can my organization benefit from a strategic partnership?

Answer - There are many attributes that a partner can bring. It can provide senior partners with a pathway to transitioning the business and a liquidity event while providing newer members with growth and ownership opportunities, it can help with retaining staff, recruiting physician partners, adding specialties, improving payor contracts, reducing supply costs, leveraging economies of scale that larger organizations can provide and help you better compete in today’s challenging healthcare environment.

Question – How do we evaluate our options and get the information we need to make a decision?

Answer – Regardless of whether you already know who you likely want to partner with or simply want to explore your options, we have found that organizations realize the best outcomes when they engage prospective buyers in a competitive process.  

This is a time consuming and complex process and takes a real commitment on your part if you are going to end up with an optimal outcome.  Some key elements that make for a successful evaluation process include creating a detailed marketing package that best presents your organization to the most qualified and likely buyers (often times hospitals, ASC companies, private equity back firms and other), interviewing and analyzing each of these firms, evaluating offers and negotiating the price and terms, signing a letter of intent to sell, going through an extensive due diligence process and finally completing all documentation and then ideally closing.  

There are really no shortcuts to realizing an exceptional outcome, evaluating all your options gives you the opportunity to truly understand what every prospective partner can bring to your organization and helps you best determine what attributes you are looking for in an ideal partner.

Question – What will my Center or Practice be like after the partnership transaction?

Answer – Your practice should function much as it does today, partners understand that the physicians and staff are the most valuable commodity that they are buying into. You will now have access to resources and capital that will help you better address your challenges moving forward while retaining your clinical autonomy.

Question - Any last remarks?

Answer – We tell everyone who is considering a strategic transaction that this is a once in a lifetime process and you are at a distinct disadvantage when dealing with experienced buyers.  Even if you already know who you want to partner with, running a highly disciplined process will not only enable you to fully understand all your options, but it also gives you the opportunity to realize the absolute best financial and non-financial terms.  The right advisors and legal counsel can add a lot of value and remember that by running a risk-free evaluation process you have no obligation to move forward with a transaction unless you have found the right partner, at the right price and with the right terms for your organization.  


About ASCs Inc. - 

The industry leading team at ASCs Inc. has been representing physician-owners who are considering selling an interest in their practice or surgery center for over 20 years. By leveraging the knowledge, experience and expertise that comes from successfully managing over 300 transactions our clients realize the best possible financial and non-financial results using our risk-free process.

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