The private equity optometry consolidation wave requires precision capital at every stage — platform acquisition, add-on deployment, integration capital, and eventual recapitalization. Lumina structures the full roll-up capital stack for Arizona-focused DSO formation strategies.
Initialize Practice Equity AssessmentArizona's optometry market presents one of the nation's most compelling PE consolidation geographies: fragmented independent ownership, above-average EBITDA margins, rapidly growing patient population, and a favorable regulatory environment under HB 2026. Lumina Medical Capital structures roll-up capital for sponsors executing the Arizona thesis — from platform formation to portfolio optimization.
Each phase of a PE optometry roll-up demands a distinct capital instrument — sized, structured, and covenanted to the platform's operational maturity at that moment.
The platform acquisition sets the EBITDA foundation for the roll-up thesis. Capital structures at this stage are acquisition-focused: 50–65% senior debt, 15–25% mezzanine or subordinated note, 20–30% sponsor equity. The platform must demonstrate ≥3 exam lanes, clean credentialing, and a documented patient panel with confirmed Medicare/Medicaid enrollment to support the add-on thesis.
Add-ons leverage the platform's established credit profile to acquire at lower multiples (4.5–6.5x vs. 6.5–9.5x for platform) — instantly creating equity value through multiple arbitrage. Capital is typically sourced from an acquisition revolver pre-negotiated at platform close, eliminating per-deal financing friction. Lumina structures the revolver commitment alongside the original platform transaction.
Post-acquisition integration requires capital beyond the purchase price: EHR migration ($15–$40K/location), branding unification ($8–$25K/location), clinical protocol standardization ($5–$15K/location), and periodic equipment refresh ($50–$180K/location). A dedicated integration facility — separate from the acquisition revolver — prevents integration costs from degrading the platform's leverage ratios.
After 3–5 add-ons, platform EBITDA typically supports a dividend recapitalization — returning sponsor equity while retaining portfolio control. Recaps require demonstrated EBITDA growth, clean audit trail, and centralized billing operations. Lumina prepares platforms for recap readiness 12–18 months before execution through proactive financial covenant management.
The fundamental PE optometry return thesis is built on paying add-on multiples of 4.5–6.0x and exiting the consolidated platform at 8.0–11.0x. The capital structure at each stage determines how much of that arbitrage accrues to sponsor equity.
Illustrative only. Actual returns depend on capital structure, individual practice performance, and exit market conditions. Not a projection.
Arizona's 2023 legislation created an explicit statutory pathway for non-physician ownership of optometry practices through PC/MSO structures — removing regulatory ambiguity that blocked PE activity in prior years. Capital structures now carry a defined legal framework, not a legal opinion.
Arizona's flat 2.5% corporate income tax rate (effective 2023) — among the lowest of any major optometry market — maximizes after-tax returns on platform EBITDA. Combined with no state estate tax and favorable asset sale treatment, Arizona sellers transact in a structurally advantaged environment.
Maricopa County's contiguous suburban geography allows 5–8 location platforms to operate within a 45-mile radius — enabling true back-office consolidation. Shared staffing pools, centralized labs, and single-vendor supply agreements create 15–22% margin improvements over fragmented independent operations.
The "Silver Surge" — Maricopa County's 65+ population growing 18–22% annually — creates a durable, insurance-backed demand base for medical-grade optometry. Medicare diabetic eye exams, glaucoma monitoring, and retinal imaging are not discretionary and not replicable by retail optical chains.
Roll-up capital and DSO formation capital are complementary disciplines. Explore integrated multi-location capital structures for Arizona optometry networks operating under the PC/MSO model.
Explore DSO/OSO Capital →Platform formation. Add-on velocity. Integration capital. Recapitalization timing. Lumina structures the complete roll-up capital architecture from first close to portfolio exit.
Initialize Practice Equity Assessment