Your Behavioral Health (YBH) announced it acquired teen mental health and substance use disorder (SUD) treatment provider Insight Treatment Programs.
The deal expanded private equity firm-backed YBH’s total footprint to over two dozen facilities across Southern California.
“An established provider in the mental health care space, Insight is an excellent fit that expands Your Behavioral Health’s regional clinical footprint, strengthens our leading position in teen services and ensures we remain a strong partner to the communities we serve,” Mike Joly, CEO of Your Behavioral Health, said in a statement.
Torrance, California-based YBH provides a full spectrum of behavioral health care, including clinical inpatient, outpatient, interventional psychiatry, residential care and sober living.
YBH operates several behavioral health brands, including Clear Behavioral Health, Insight Treatment Programs, Neuro Wellness Spa and New Life House and Insight.
Van Nuys, California-based Insight Treatment Programs provides intensive outpatient treatment programs (IOPs) and partial hospitalization programs (PHPs) tailored for teens ages 13 to 19 with mental health conditions and SUDs.
Originally founded as a drug and alcohol outpatient treatment program, Insight later expanded into mental health care. It now operates six facilities with ‘fun and creative clubhouse environments’ tailored to foster relationships with teens. The company also provides support for the parents and families of teens.
West Palm Beach, Florida-based private equity firm Comvest acquired YBH in June 2023.
“The Comvest team shares our commitment to delivering best-in-class care for favorable and lasting clinical outcomes,” Dr. Martha Koo, chief medical director of YBH, said in a statement. “In particular, we look forward to leveraging Comvest’s operational resources to aid strategic investment in Your Behavioral Health’s infrastructure, people and operational processes during a critical period of growth.”
Comvest, an operationally focused, middle-market private equity firm, manages $10.4 billion in assets. It invests in companies with EBITDA greater than $7 million and revenue between $50 million and $1 billion.
The firm raised $881 million in its sixth private equity fund in March from investors including foundations, insurance companies and pension funds.
“This fundraising milestone is a testament to the experienced and proven investment team we have built at Comvest,” Maneesh Chawla, a managing partner at Comvest and head of the firm’s private equity strategy, said in a statement. “Comvest has a long tenure supporting middle-market companies that seek a seasoned partner to help grow their businesses. We are excited about the continued momentum of our firm, our private equity investment approach, and our team.”
Comvest plans to deploy up to $150 million of the private equity fund per investment in consumer, health care and professional and managed care industries, among others.
Comvest’s investment in YBH is not its first foray into the behavioral health sector. The firm joined with Silver Point Capital LP, to invest in the substance use disorder (SUD) treatment provider Ocean Healthcare in 2022.
In addition to investing in YBH, Comvest has also invested in another behavioral health business.
Private equity has, historically, accounted for the bulk of all behavioral health deal flow since 2018, according to The Braff Group. While the percent of deals sponsored by private equity dipped from 2022 to 2023, the number of private equity platform deals slightly increased year-over-year.
“This data point is even more telling when you consider that, excluding behavioral health, all other health care service platform activity fell more than 46% (56 in 2022 to 30 in 2023),” read The Braff Group’s report.
Overall behavioral health M&A was down in 2023, but is anticipated to rebound, at least to a small degree, in 2024.
A federal crackdown on private equity’s involvement in the health care industry, however, could discourage M&A in 2024 and beyond.
