Houlihan Lokey Advises LCS

Houlihan Lokey is pleased to announce that LCS has completed a majority recapitalization that adds Redwood Capital Investments (Redwood) and renews the ownership interest and commitment from McCarthy Capital (McCarthy) and LCS employee shareholders. The transaction closed on December 28, 2021.

Headquartered in Des Moines, Iowa, and founded in 1971, LCS is the second largest senior living operator in the U.S. The LCS Family of Companies includes a development arm, a management company, a group purchasing business, and a real estate private equity enterprise, as well as a nonprofit foundation. LCS is designed to fulfill the mission of each senior living community, allowing the company to develop and share expertise and deliver innovative solutions to partners, seniors, and their communities. The company has received numerous industry accolades and awards, including ranking first in customer satisfaction for three consecutive years among independent senior living communities in the J.D. Power 2021 Senior Living Satisfaction Study.

LCS will use the recapitalization to support the company’s long-term strategic plan to grow real estate ownership, strengthen infrastructure and support for its third-party management and ancillary business lines, as well as invest in the company’s people and growth initiatives that support the company’s service to seniors.

McCarthy Capital is a private equity firm focused on being a value-added partner for management teams. For more than 30 years, the McCarthy organization has been partnering with founders, families, and exceptional management teams to support the growth of their companies.

Redwood is a diversified holding company that provides a permanent home for founder-, family-, and management-owned businesses. Redwood has investments in businesses across several industries, including senior living, distribution, automotive, real estate, and equipment leasing.

Houlihan Lokey served as the exclusive financial advisor to LCS.

This transaction further strengthens Houlihan Lokey’s leadership position across seniors housing and post-acute care sectors. Houlihan Lokey’s Healthcare Group is among the largest dedicated healthcare investment banking groups in the country. In 2020, the Healthcare Group closed 22 transactions and was ranked the No. 1 M&A advisor for U.S. healthcare transactions under $1 billion by Refinitiv.