Elements Behavioral Health has been actively expanding these days, as evidenced by the purchase of Park Bench Group Counseling in New Jersey in late December, followed just weeks later by the opening of Brightwater Landing in southeastern Pennsylvania.
“We look at acquisitions in terms of the kind of clinical services they provide, whether they’re complementary to the other services Elements provides and whether geographically they’re complementary,” David Sack, MD, president and CEO of Elements, tells Behavioral Healthcare. “There’s always opportunity to grow geographically to make services more accessible.”
And the centers within the Elements portfolio are also ramping up programs to meet changing market demands. In 2015, its centers in Texas and Tennessee will add new services, and a detox program in Florida will launch in the first quarter of the year, Sack says.
Within all this activity, observers are reporting that Elements is for sale. Reuters reported in December that private equity and venture capital firm Frazier Healthcare is potentially looking to sell Elements, and that investment bank Jefferies Group LLC has been retained to facilitate the next steps. Across the entire industry, valuations are up, and the market is ripe for activity.
Meanwhile, The Deal reported that Elements has $30 million in EBITDA (earnings before interest, taxes, depreciation, and amortization) and “could command as much as 12 times that in a sale.”
Sack says the organization is exploring its opportunities.
“Like most companies that are growing, we are always looking at the best way to finance and capitalize that growth, so we retained Jeffries last fall to evaluate the options for supporting the growth strategies,” he says. “We’re looking at whether or not a new investor group would be appropriate or other options to continue on our growth trajectory.”
Founded in 2006 by two therapists, the newly acquired Park Bench in New Jersey provides day treatment and intensive outpatient services, including an individualized aftercare program.
“We have wanted to be in the Northeast for some period of time, particularly in the New York/New Jersey Tristate area because we see that as a population we can make a contribution in,” Sack says. “We were excited about the prospects of acquiring Park Bench and its focus on young adult treatment. The services they’re providing, which are addiction and co-occurring disorders, fit well with the Elements family of programs.”
In the Pennsylvania market, the company has an existing property, Clarity Way, in York, Pa., and this month, it adds to its portfolio a new location, Brightwater Landing in Lancaster County. The facility is on a 150-acre campus that lends itself to treatment interventions that require more outdoor space as well as landscape features appropriate to experiential and adventure-based therapies.
For example, Sack says treatment will include equine therapy and a ropes course to enable clients to process the emotional and behavioral parts of their addiction. The experiences will address not just the substance-use disorders but also the underlying trauma that contributes to using. Because it’s physician-led, he says, the center will offer primary psychiatric and active mental health models of care.