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Capstone Headwaters Advises BRC Recovery on its Recapitalization

April 2020

Boston, MA - Capstone Headwaters, a leading middle market investment banking firm, advised BRC Recovery Family of Programs (“BRC” or the “Company”), a premier provider of in-patient substance abuse treatment programs, on its recapitalization transaction with investment firms NewSpring Capital (“New Spring”) and Veronis Suhler Stevenson (“VSS”).  Terms of the deal were not disclosed.

Headquartered in Austin, Texas, BRC provides individualized, gender specific treatments to adults (aged 17+) with substance use disorders such as alcoholism, drug dependence and other addiction disorders. Founded in 2006, the Company offers the full continuum of care from detox and intensive outpatient services to residential treatment to sober living, through its four high- quality clinical programs – BRC Recovery, Spearhead Lodge, Makana Path and Segue Recovery.

“It’s amazing what we’ve been able to accomplish by staying rooted in our principles and aggressively addressing the needs of the market. I’m grateful to have a top-notch team and the opportunity to build a new platform that fuels our continued growth and ability to serve more people,” said Marsha Stone, BRC’s founder.

“We’re always looking to invest in healthcare companies that bring innovative ideas and ways of thinking to markets in need of new solutions. This is exactly what BRC is doing in the addiction treatment and therapeutics space,” said Kapila Ratnam, Ph.D., Partner at NewSpring.  “We’re thrilled to work with VSS to bring operational expertise to BRC and make additional investments in transformative healthcare companies.”

“We are very excited for Marsha Stone and the rest of the extraordinary management team and BRC.  We are looking forward to watching the company grow as a platform investment under the guidance and support of NewSpring and VSS,” noted John Ferrara, Capstone Headwaters’ founder and CEO.  “We are honored to have been part of Marsha Stone’s entrepreneurial and personal legacy.”

BRC stands for “Bringing Real Change,” and is an industry-leading provider of treatment services designed to meet the needs of an ever-changing landscape of substance use disorder. The BRC Family of Programs has a rich history of providing treatment that is structured to ensure personal attention. The BRC family offers three unique programs under its umbrella of residential care- BRC Recovery, Spearhead Lodge, and Makana Path. Its programs are supported by Segue, an extensive post-treatment network which includes sober living homes and outpatient services. BRC programs are fully supported by a team of medical and psychiatric professionals allowing for the admission of dually diagnosed and medically complex cases. For more information, please visit www.brc-healthcare.com.

NewSpring partners with the innovators, makers, and operators of high-performing companies in dynamic industries to catalyze new growth and seize compelling opportunities. The Firm manages over $2.0 billion across four distinct strategies covering the spectrum from growth equity and control buyouts to mezzanine debt.  Having invested in over 150 companies, NewSpring brings a wealth of knowledge, experience, and resources to take growing companies to the next level and beyond.  Partnering with management teams to help develop their businesses into market leaders, NewSpring identifies opportunities and builds relationships using its network of industry leaders and influencers across a wide array of operational areas and industries. For more information, please visit www.newspringcapital.com.

VSS is a private investment firm that invests in the healthcare, information, business services and education industries. Headquartered in New York, VSS provides capital for growth financing, recapitalizations, strategic acquisitions, and buyouts to lower middle market companies and management teams with the goal of building companies organically as well as through a focused add-on acquisition program. VSS makes privately-negotiated investments across the capital structure and invests in situations requiring control or non-control equity, mezzanine securities, and structured equity securities. VSS has over three decades of experience, made investments in 86 portfolio companies, with over 350 add-on acquisitions, and manages $3.5 billion in aggregate committed capital across 7 funds. For more information, please visit www.vss.com.