Matthew Frankel, the managing partner at Levine Leichtman Capital Partners, repeated the word “conviction” when discussing his private equity firm’s acquisition of Synergy HomeCare.
“We tend to have a lot of conviction when we see a great opportunity and the deeper we got into our analysis of Synergy, the more conviction we had that we really need to get ahead of the process and get this deal done,” Frankel said. “We’re thrilled to be able to close on this key acquisition for us as quickly as we did.”
New York-based Levine Leichtman’s purchase of Synergy from NexPhase Capital for an undisclosed amount represents a new start for the in-home provider that was founded in 1999 by Peter Tourian and began franchising in 2005.
Synergy, which provides a broad range of non-medical care services including personal, companion, memory and specialized care for individuals who are living with physical or developmental disabilities, chronic health conditions or recovering from illness or surgery, has 240 franchisees operating in 540 territories in 42 states.
The Arizona-based company has added 176 units since 2020 and said it sold 76 territories last year.
Its 2024 franchise disclosure document reports an average unit volume of $488,501 for single-unit locations open one to five years and $1.16 million for those open six to nine years. AUV for multi-unit owners was $955,842 and $1.87 million for the same amount of time open, respectively. The investment range for single-unit operators is $73,148 to $153,479.
LLCP is private equity firm headquartered in Beverly Hills, California, and has offices in four countries. Frankel said talks with Synergy began last fall and both sides were “on the same page” throughout the acquisition process. He also said there are no plans to make any changes to Synergy’s executive team which has been led by CEO Charlie Young since 2020.
“Synergy is a very successful company with a fabulous management team operating in a great market. Our approach will be to take an active board role in the company and give Charlie and his team the autonomy to run their business in a day-to-day fashion in a very similar way as they were running things prior to our investment,” Frankel said.
LLCP’s plans for Synergy include supporting the brand with capital, resources and expertise to grow unit economics, Frankel said.
“Our key priorities continue to be growth oriented, including opening new markets, helping optimize our existing franchisees’ operations, enhancing our service offering and expanding access to professional in-home care to more people,” Young said in a statement announcing the new owners.
Under Young’s leadership, Synergy launched a number of new initiatives over the past few years which included the launch of a disability care awareness program designed for those with disabilities to “gain a healthier, safer and happier quality of life at home.”
Additionally, Synergy made what Young described as significant investments in innovation across its service lineup. It included the development and enhancement of programs for veterans, memory care and hospital-to-home care, or as Synergy labels it “ConciergeCare,” which can begin as early as pre-discharge from a hospital.
Most Synergy franchises are contracted with the U.S. Department of Veteran Affairs, allowing veterans to use their VA benefits to gain access to the brand’s home care.
Related: Synergy CEO Oversees New Growth for In-home Care Brand
Levine Leitchtman—a middle market private equity firm with a 40-year track record of investing across multiple sectors including business services, education and training and engineered products and manufacturing—has bought stake in 31 franchisors in 19 transactions. Frankel said the firm was one of the earliest investors in franchising when it purchased equity in fast-casual brand Quiznos 25 years ago.
LLCP acquired Senior Helpers in 2012 and sold it to Altaris Capital Partners in 2016. Last year, it sold its majority stake in Tropical Smoothie to Blackstone, Hand and Stone Massage and Facial Spa to Harvest Partners in 2022 and Nothing Bundt Cakes to Roark Capital in 2021. Past investments for the firm include Fastsigns, Mountain Mike’s Pizza and Wetzel’s Pretzels
Along with Synergy, Levine Leichtman’s current portfolio of franchise brands consist of Kilwins, a retailer, manufacturer and distributor of premium quality chocolate, ice cream and confectionary products, and home service brand Lawn Doctor.
“Will we be adding more franchise brands to our portfolio? I sure hope so,” Frankel said. “We’ve got our eye on a number of different things right now.”