At a time when trade show companies everywhere are pondering diversification into digital media, Tarsus Group has acquired a subscriptions-funded platform to complement its medical events.
The UK-based organiser of some 150 exhibitions has acquired 60% of BodySite Digital Health, a patient care management and education service currently used by 1,000 doctors in the US. Under the terms of a two-year earnout, Tarsus will acquire 100% of the 11-year-old, Florida-based startup for a price believed to total some $20m. BodySite, which employs fewer than 10 people, is estimated to have current revenues of $2-3m and EBITDA margins of 20%.
The BodySite website says: “From doctors to chiropractors and coaches to supplement companies, the best healthcare providers are using BodySite to digitally deliver care information.”
It will enable the Tarsus Medical Group (whose events currently work with 80,000 doctors in the US) to expand its stack of digital products for healthcare professionals – and also bolster its subscriptions revenue. The acquisition would “fast-track Tarsus Medical’s omnichannel strategy to provide digital services and products alongside its well-established program of live and virtual events and continuing medical education, particularly in the division’s American Academy of Anti-Aging Medicine (A4M) brand”.
Tarsus points out that a key driver in the US healthcare industry has been the shift to preventive medicine, hence the demand for digital tools like BodySite which offers medics: remote patient monitoring, telemedicine, and educational programs. The service is said to have been more widely used during the pandemic when visits to doctors were restricted.
The then listed Tarsus Group was acquired two years ago by Charterhouse private equity for $703m (£668m), an estimated 12 x EBITDA. The company had revenue/ operating profit of $98.3m/ $14.5m for the 4.5 months of 2019 under new ownership. Some 52% of revenue was EMEA, while the Americas accounted for 38%.
Since the Charterhouse takeover, Tarsus has acquired: Smarter Shows (UK), TyreXpo (Singapore), and BizBash Media (US). It also bought 50% shares in Jiuzhou and Shanghai Intex, in China, and TAK, in USA/Mexico.
Almost 70% of the $51m investment (before this week’s deal) was for Smarter Shows. But $18.5m (46%) of the total was deferred consideration (including 42% of the Smarter Shows price), so the actual sums paid may have been substantially reduced by the pandemic suspension of live events in 2020-21.
Significantly, the Tarsus exhibitions in the medical and labels markets together account for almost 50% of the book value in its latest accounts. These events – together with those in Aerospace, US travel, China textiles – account for almost 75% of the company’s total value.
The BodySite deal underlines the determination of Tarsus and its private equity owner to maintain the pace of acquisitions at a time when so much is potentially on offer. But the medical market diversification also highlights the possibility that the future of Tarsus et al may be in building integrated vertical companies which can eventually be sold-off separately to other market specialists. Way to go.