Is there a bad time to sell my ASC?

Yes of course there are less optimal times to sell you ASC.

From the financial sense if you are still growing rapidly, recruiting new surgeons or have the market that would allow with some help that growth, then it is in your best financial interest to capture that growth before you sell. In other words you really do not want to sell your surgery center before the timing is right regardless of what stage your ambulatory surgery center is in. Sounds easy….the challenge is that there are some variables that are unknown in that formula without a crystal ball. So it is no different than making a surgical decision, you have to look at the situation in its entirety, analyze your ASC first-do a Ambulatory SWOT analysis (look at yours and the market’s Strengths Weaknesses Opportunities and Threats)-then look at and pay close attention to your weaknesses and opportunities. This will drive your decision. Make a professional judgment and decision and then execute on that decision.

Examples of bad times to sell were bad times because we had to sell the ASC. If we were advising the centers earlier on in the process, we would have taken a different direction with the benefit of time. One time a surgery center’s majority owner, who was a surgeon, called 9 months prior to us working with him and in reality it was too late 9 months later. When he first had called us and we discussed the situation in depth, we recommended that we work together to syndicate and recruit more doctors and then add an ASC management company or hospital partner. At that time we assumed that the cost of that process was a barrier, but he called 9 months later with significant issues hanging over his head. We told him that we really did not want to get involved, but he literally begged us to help him. We explained how difficult given his timeline that it was going to be and that we would not get to where he wanted to get, but we ended up taking him on as a client. He ended up having to sell his CON and assets just to mitigate his damage.

So the answer is that the bad time to sell is when you wait until you have no other option but to sell or in other words when you are forced to sell. This can happen if you are not a realist and are not able to realistically look at your SWOT and understand that either you have some weakness or your market does and you need help shoring up those weaknesses. People do this by blaming external factors when a lot of times the majority of the issues inĀ under-performing surgery centers are internal. Thus timing is a big key and you need to be constantly evaluating your strategic options and executing your plan. If buyers do not add value that you can capture, then it is a less than optimal time to sell.

When a company is at about 70% capacity, profitable and growing, it is the perfect time to sell. The highest premiums are obtained when you are still on an upward track, rather than at your peak or declining. It is also worth considering selling a portion of your center (recapitalizing) when the value is high, and sell the remainder when the center peaks. This can diversify your risk and take care of you and your family for the future.

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Category: Selling My Ambulatory Surgical Center
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