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By Richard Asinof
PROVIDENCE – Koch Eye Associates became the first medical practice in the United States to be bought by a private equity firm, Boston-based Candescent Partners LLC, according to Peter Koch, who will remain as CEO of the firm for the next three years.
The deal, for an undisclosed sum, closed on Jan. 27, after the transfer of the medical license for Koch’s St. James Surgery Center in Warwick was approved by the R.I. Department of Health.
Candescent’s decision to acquire Koch Eye Associates, with its seven locations throughout Rhode Island and 140 employees, evolved over the course of discussions that began more than year ago. “We had to make a decision, as we were getting older, whether to contract a little bit, or find some kind of exit strategy,” said CEO Koch, who is 62.
The original papers were signed in March 2011, and there was a preliminary closing on Sept. 1, 2011, with the family-run medical practice operating under an asset purchase agreement.
“Moving forward, the strategy is that we’re going to become much bigger, having a presence throughout New England,” Koch told the Providence Business News. “What excited Candescent was our business model – with multiple offices that had its own surgery center.” What the business is looking for, Koch continued, “are other ophthalmology practices in New England that are interested in joining the practice’s model.
Under the purchase agreement, Peter Koch will remain as CEO for the next three years. His brother Paul will remain medical director for five years, and his sister, Patty, will remain for between two to four years. In addition, a new chief operating officer has been hired to manage the new, multiple businesses planned in the expansion.
“We’ve worked very hard to make our business successful with excellent patient care,” Koch said. “Candescent saw this, and saw an opportunity.”
The medical practice will continue with its current expansion plans in Rhode Island, moving to a new location in Woonsocket that will triple its office space In addition, a new office will be opening in South Kingstown off Route 1 in November.
“Rhode Island has been very good to us,” Koch continued. “We’re expanding, we’re getting bigger. But nothing is going to change from the patient’s point of view. This is the American dream. Start something from scratch, build it up and get rewarded at the end.”