Wells Fargo funds healthcare

Wells Fargo Capital Finance has announced that its healthcare finance group has provided $125 million in funding for Springstone, a developer and operator of behavioral health hospitals, which will be using the proceeds from the facilities to fund working capital and finance future growth.

Founded in 2010, Springstone provides inpatient and outpatient services for people needing treatment for mental illness and/or addiction. The company currently operates 11 behavioral health hospitals in five states, with a number of new facilities under development.

“Wells Fargo’s knowledge and expertise in the healthcare industry will help us to provide services to areas that are currently underserved,” said Robert Maha, CEO of Springstone. “We’re pleased to have completed this financing with Wells Fargo and look forward to growing our relationship with them.”

“Springstone is an innovative company, led by a first class management team providing professional and compassionate services and environments for healing.” said Michael Janda, managing director in the Healthcare Finance group at Wells Fargo Capital Finance.

Middle market momentum

Earlier this year, research from Wells Fargo Capital Finance suggested that while middle market asset based lending in 2015 was modest compared to 2014, it was expected to pick up in 2016.

“While most of the volume in 2015 was refinance driven, demand for fixed asset related loans continued to increase. This was partially due to some organic growth in the market, but also largely due to deferred capital expenditures,” explained Steve Bishop, executive vice president, middle market loan originations, Wells Fargo Capital Finance.

Bishop suggested an upswing in the second quarter of 2016 would be driven by a number of factors, citing in particular opportunities in the energy market and in the scrap metals and recycling sector, both of which have seen heavy falls in asset valuations.