How to Prepare Your ASC for a Transaction: A 12-Month Readiness Roadmap
Building a 12-month runway before engaging the market can position your ASC for a stronger valuation and a wider range of deal options.
Ambulatory surgery centers (ASCs) are fast becoming the darlings of the healthcare investment world as several key forces converge. The phase-out of the inpatient-only list is expected to drive more procedures into surgery centers, as private equity pours in capital and payers signal stronger support. These dynamics are opening new opportunities for ASC owners to either cash out or double down through strategic partnerships.
Yet even in a favorable market, ASCs that approach a transaction unprepared risk leaving value on the table. That’s true across deals with private equity, other practices, a hospital system, or some combination. Giving yourself a 12-month runway lets you fine-tune every aspect of your ASC before engaging the market.
This roadmap outlines what to address, the sequence to follow, and why it matters, enabling you to enter a transaction with an ASC positioned to command its full value.
Months 1-3: Foundational Assessment
Transaction preparation starts with knowing where you actually stand, not where you think you stand. This quarter is about honest assessment and finding shortcomings before buyers do.
Clean up your financials. Your profit-and-loss (P&L) statements should clearly articulate your center’s performance. That means properly categorizing implant costs, breaking out anesthesiology expenses, and ensuring every line item tells an accurate story. If your financials are messy, buyers or partners will assume operations are, too.
Evaluate your ownership structure. Pull out your operating agreements and read them as a buyer would. Look for provisions that could block a transaction: restrictive transfer rights, overly complex entrance and exit terms, or consent requirements that give any single partner veto power. The greater the structural complexity, the greater the perceived risk. Simplifying your structure now pays dividends later.
Benchmark your performance. Compare your reimbursement rates to market data. Analyze how effectively you’re collecting what you’re owed. Assess your OR utilization and identify capacity constraints. Understanding these metrics highlights your strongest levers and where improvement is mandatory, giving you time to close gaps.
Months 4-6: Operational Improvements
Assessment finds problems. Optimization fixes them. This quarter is about improving the operational fundamentals that drive valuation.
Maximize utilization. Underutilized or inefficient ORs leave value on the table. Slow turnover or idle time also signals that growth will require additional investment. Consider partnerships to fill scheduling gaps or adding complementary specialties that expand your case mix without cannibalizing existing volume. Every incremental case that adds margin increases enterprise value.
Improve revenue cycle management. Weak RCM performance costs revenue and undermines confidence in your financial controls. Improve collection rates to match or exceed industry benchmarks. Demonstrate consistent, predictable cash flow. Eliminate revenue leakage. When buyers see tight RCM operations, they see an asset that won’t require immediate post-close fixes.
Develop your growth story. Every strong deal has a growth narrative at the center. Identify clear pathways for expansion: geographic opportunities, procedural growth, or payer contract improvements. If you can show that outcomes at your center drive faster recovery times or lower complication rates, collect that data. Hard evidence of clinical value strengthens rate negotiations with payers and makes your growth story credible to buyers.
Months 7-9: Strategic Positioning
You’ve fixed the fundamentals. Now it’s time to position the business strategically for the type of transaction you want.
Build management infrastructure. Independent physician-owned centers often lack the operational oversight that institutional buyers expect. Consider whether a management services organization (MSO) structure makes sense or tighten the operational controls you already have. Establish consistent reporting, documented processes, and clear accountability. Buyers want to see an ASC run on a stable, repeatable system that can scale.
Align physician partners. Misaligned referral patterns can torpedo deals. If surgeons are sending half their cases to competing facilities because of convenience or legacy relationships, buyers will question the stability of your volume. Address alignment now, not during due diligence. Build consensus around transaction goals and make sure everyone understands physician alignment is a key value driver.
Conduct preliminary valuation. Engage an advisor to understand your current value and what drives it. A preliminary valuation exercise can reveal the gap between where you are and where you could be. It sets realistic expectations about transaction outcomes and identifies the highest-return areas for improvement.
Months 10-12: Transaction Preparation
The final stretch is about packaging everything you’ve built into a strong, buttoned-up story that buyers can underwrite with confidence.
Prepare due diligence materials. Commission a quality of earnings (QoE) report that normalizes your financials and gives credit for add-backs. Build a financial model that shows historical performance and realistic projections. Assemble a complete data room: contracts, licenses, regulatory filings, payer agreements, and physician relationships. The more organized and transparent you are, the faster diligence moves and the fewer surprises emerge.
Engage professional advisors. Hire transaction advisors with experience in ASC deals. Bring in legal counsel who understands the regulatory nuances of surgery center transactions. Work with valuation experts who can defend your numbers. The right team not only facilitates the deal but also ensures the best outcome and protects your interests throughout the process.
Position your narrative. This is where all the work you’ve done comes together into a clear narrative. Your story should highlight sustainable competitive advantages: strong payer relationships, physician alignment, operational efficiency, and clear growth opportunities. Buyers invest based on both current performance and forward potential. Your narrative brings that potential into focus.
Building Value Before the Deal
A common mistake ASC owners make is going to market without doing the foundational work that de-risks the opportunity in a buyer’s eyes. When you’re managing the day-to-day operations of an ASC, it’s easy to kick the can down the road, but that lack of preparation shows up in valuation and can limit your transaction options.
“The most painful part is when agroup is ready for a transaction, but they don’t have their ducks in a row andaren’t showing the narrative on paper the way they should.”
Buyers will always find issues during diligence, from financials that don’t tell the right story to ownership structures that create friction or revenue cycle problems that signal risk. It’s far better to fix them proactively than explain them defensively. The reward for 12 months of focused preparation isn’t just a higher valuation; it’s greater options, a cleaner process, fewer surprises, and stronger terms. Don’t kick the can down the road.
Ready to assess your ASC’s transaction readiness?
