By Joe Paduda

Last Friday I posted the news that One Call Medical was going to be acquired; here's the official announcement which was published yesterday.

On Monday One Call Medical will announce the company has agreed to be acquired by Odyssey Investment Partners, a New York private equity firm. One of the larger private equity firms, Odyssey has some experience in the work comp business, purchasing York Claims several years ago from AIG and by all accounts transforming that firm from a low-end TPA to one of the up-and-comers.

The deal is the result of a process that has been proceeding for several months; as the dominant company in the work comp imaging management space, OCM was the subject of significant interest, attracting bids from several investment firms. I don't know the parameters of the deal, but will guess OCM went for a figure well above $100 million with a valuation north of seven times EBITDA.

While the work comp market is OCM's primary space, the company has recently made successful, if limited, forays into the group health and consumer markets. Look for OCM to expand their efforts in that sector, as there is limited growth opportunity in comp where they handle about one of every six MRI scans.

But for now comp is the revenue driver. A source close to the deal indicated OCM's top line is in the $250 million range, and despite the decline in claims frequency, the company experienced solid growth this year.

This marks the second significant deal in the work comp space this fall; FairPay Solutions was acquired by the Riverside Companies a couple months ago. Sources indicate there is at least one more deal 'pending'; this one looks a little more iffy.

Joe Paduda is principal of Health Strategy Associates in Connecticut. This column was reprinted with his permission from his blog, http://www.managedcarematters.com