- New Mountain recently announced it is buying a majority stake in Ontario Systems. These are the details behind the deal.
Ontario Systems — a leading provider of enterprise software that automates complex workflows and accelerates revenue recovery for clients in the healthcare, accounts receivable management (ARM), and government markets — recently announced it entered a definitive agreement to partner with New York-based New Mountain Capital in the form of receiving an investment for a majority stake.
New Mountain Capital is a leading growth-oriented investment firm with over $20 billion in assets under management. And with its purchase of a majority share in Ontario Systems, New Mountain Capital will replace Arlington Capital Partners as the company’s largest investor. The terms of the transaction were not disclosed.
Ontario Systems was founded in 1980 and it has nearly 500 employees in 28 states and serves its customers from its headquarters in Muncie, Indiana and has additional offices in Vancouver, Washington, and Albuquerque, New Mexico. And Ontario Systems counts among its customers more than 600 hospitals—including five of the 15 largest hospital networks—that actively manages over $40 billion in receivables collectively as well as eight of the 10 largest ARM companies and more than 600 federal, state, and municipal government clients in the U.S.
Ontario Systems’ customers handle more than $170 billion in payments annually. And in recent years, Ontario Systems has enjoyed record revenues, profitability, and growth by helping clients simplify their operations, lower costs, and recover more revenue.
Why is New Mountain buying a majority stake in Ontario? Here is what Ontario Systems president Jason Harrington said:
“This is an exciting time in Ontario’s history, and partnering with New Mountain Capital is a natural step in our progression as we continue to execute on company-wide strategic initiatives. The New Mountain team’s expertise in growing software businesses will be invaluable as we look to deepen our revenue cycle management (RCM) offerings and continue providing our customers market-leading solutions they have come to trust. Building on the momentum of this transaction, I look forward to working closely with New Mountain to unlock unique growth opportunities.”
Ontario Systems is known for offering a full portfolio of leading software platforms including the Artiva family of products, FACS, TCS, RevQ, and Ontario Omni.
“Ontario exemplifies New Mountain’s longstanding investment thesis of backing best-of-breed solutions providers addressing critical pain points in revenue recovery and workflow management,” added New Mountain Capital Managing Director and Deputy Head of Private Equity Matt Holt. “We look forward to supporting Ontario’s continued growth by identifying both organic and inorganic initiatives to help the company realize its full potential.”
Ontario Systems’ portfolio also includes Justice Systems solutions such as FullCourt Enterprise, whose integrated technologies empower state and local governments to manage court cases, process online payments, and automate revenue recovery processes.
“In an effort to better serve our own teams and customers and keep pace with available technology, our business continuously evolves, but some things remain the same,” explained Ontario Systems Vice President of Marketing and Business Development Casey Stanley. “Our existing strategy of investing in and around Muncie, as well as our other locations, remains unchanged—as does our focus on our people, our customers, and our communities. We look forward to our new relationship with New Mountain Capital and where we can go together.”
Law firm Ropes and Gray LLP acted as legal advisor to New Mountain. And New York-based investment company Eir Partners served as an advisor on the transaction.
“Ontario Systems marks the fifth platform company collaboration between Eir Partners and New Mountain in less than four years. The value proposition at the customer level is simple – cash acceleration and improved employee experience and productivity,” commented Brett S. Carlson, the Founder and CEO of Eir Partners. “From this attractive starting point, we have built an accelerated growth and transformation strategy and look forward to partnering with Jason and the rest of the Company to execute on this plan.”
“Our relationship with Arlington Capital Partners has been outstanding,” noted Ron Fauquher, the CEO and co-founder of Ontario Systems. “With Arlington’s assistance, we have successfully expanded our healthcare-market footprint, entered government markets, doubled our revenues, and expanded our reach to include more than 1,200 clients. We are proud of our progress and achievement of the goals we had previously set, and we thank Arlington for their support in helping drive our strategic growth initiatives. As we take the next evolutionary step, we look forward to New Mountain Capital’s support and partnership.”
