September 10, 2010
Milwaukee Journal Sentinel

Private equity firm invests $2 million in Integrated Medical Partners
By Kathleen Gallagher

Blackthorne Partners Ltd. has invested $2 million in Integrated Medical Partners LLC, a Milwaukee company that runs several health care information technology businesses.

Blackthorne closed this week on the funding, which gives it a minority stake in the company, said John F. Syburg, the firm's president and co-founder.
This is the first time Blackthorne has invested directly in a company. The Milwaukee private equity firm also pools investors to put money into private equity funds run by other firms.

Integrated Medical Partners, known as IMP, has 170 employees, with 40 working from Milwaukee. It runs three businesses.
The oldest, Dominion Medical Management, is a 20-year-old company that provides coding, billing and other business services to hospital-based physician groups.

Bill Pickart, Bob Kebbekus and Tim Dyer bought Dominion 10 years ago and moved its corporate offices to Milwaukee from Virginia. Pickart is IMP's chief executive officer, Kebbekus is president and Dyer is chief financial officer.
"You have this very stable, growing, high cash flow business in Dominion, and that cash flow is funding growth of its newer divisions," said Syburg, who joined IMP's board after Blackthorne closed on the funding.

The newer divisions are ProSperus, which provides coding, billing and other business services to office-based physicians and small community hospitals, and Plexus TeleRadiology, which is building a clearinghouse for transferring images and other data between radiologists so they can share their services from remote locations.
Blackthorne's funding will provide growth capital for ProSperus and Plexus, Syburg said.

Most of IMP's 170 employees work for Dominion, and it pulls in the lion's share of the company's revenue, but Blackthorne's investment will help change that mix, Dyer said.
"The capital Blackthorne is providing allows us to grow those two (newer) businesses to a level where they might have 150 employees in the next two years and as many as 350 in five years," Dyer said. About one-third of those employees would likely be in the Milwaukee area, he said.

Blackthorne is focusing its direct investments in the smaller, more neglected part of the private equity landscape - companies with $2 million to $10 million in revenue, Syburg said.
It's a good time to invest in private equity and stay away from the vagaries of the stock market, said Fergie Locke, retired head of Nasdaq trading for investment firm Cleary Gull. Locke put money into the IMP deal and in some of Blackthorne's pooled private equity fund investments.

Blackthorne was founded in 2007 by Syburg and Mark R. Zellmer, who is also president of Northern Oak Asset Management Inc., a Milwaukee money management firm.

Earlier this week, the company said it has added Steve Balistreri as a partner.
Balistreri, a relative of the family that runs the Sendik's Food Markets, was previously president and chief executive officer of Sun Cleaning Systems.

Balistreri bought Sun Cleaning in 1988,when it had $100,000 in sales and eight employees, he said. He sold it in 2007, when it had $10 million in sales and over 650 employees, Balistreri said.

Balistreri's operations experience and understanding of internal controls were key to Sun Cleaning's success and are expected to help the companies in Blackthorne's portfolio, Syburg said.

"There are a lot of good companies with sales of $2 million to $10 million," he said. "If we bring our blend of operational and financial knowledge to those kinds of companies, we can accelerate their success."
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