Southlake, Texas-based Allied OMS has closed on a $116 million credit facility from four banks in the healthcare sector.
The credit facility represents Allied OMS' first round of outside financing and will be used to fuel the organization's future growth, including the recruitment of more doctor partners and construction of de novo offices, according to a May 14 news release.
The company has already used funds to integrate additional services related to insurance benefits and finance and accounting, Allied OMS Founder and CEO Daniel Hosler told Becker's.
"One of the things this allowed us to do immediately was to further integrate our platform," Mr. Hosler said. "In Q1, one of our big initiatives was doing HR integration so that all of our employees could have the same health, vision and dental benefits. It also allowed us to do further integration on the finance and accounting side, specifically in treasury management. Now that that's done, this allows us to invest further into the business. Doctor recruiting is an important initiative. We've recently hired a new person to spearhead our doctor recruiting and then we're also working on adding more operations resources so we can continue to provide better field support for our practices."
The banks that provided capital to the MSO include KeyBanc Capital Markets, BankUnited, Umpqua Bank and First-Citizens Bank & Trust Company.
Mr. Hosler said in the news release that the credit facility allows the company to provide capital at lower rates for its shareholders compared to other private equity-backed groups.
"One of the biggest differences is that because we went down the commercial bank route and not the private credit route, it means we're going to be much more efficient from a cost of capital perspective," Mr. Hosler told Becker's. "We've intentionally taught our doctors about the different types of debt that are out there in the market. We had conversations with a number of different debt providers across the board and we're really excited about being able to be thoughtful about the capital efficiency when bringing debt into a business."
Allied OMS supports 60 doctors and 39 locations in California, Colorado, Illinois, Louisiana, Maryland, Michigan, New York, Oregon, Tennessee, Texas and Virginia.