Addus HomeCare Corporation (NASDAQ: ADUS), “Addus” or “the Company,” a provider of comprehensive home care services, today announced the signing of a definitive agreement to purchase Hospice Partners of America, LLC, a multi-state provider of hospice services, headquartered in Birmingham, Alabama, for a cash purchase price of $130.0 million, representing $118.4 million of value, net of the present value of $11.6 million of estimated tax benefits. Hospice Partners of America currently serves an average daily census of approximately 1,000 patients through 21 locations across Idaho, Kansas, Missouri, Oregon, Texas and Virginia, with annualized revenue of approximately $55 million. Addus expects to complete the transaction following completion of all required regulatory approvals, subject to customary closing conditions. Addus will fund the acquisition through the Company’s revolving credit facility.
Dirk Allison, President and Chief Executive Officer of Addus, commented, “We are very pleased to announce our agreement to purchase Hospice Partners of America, an established provider of hospice services in multiple states. This acquisition is consistent with, and supports our strategy of adding hospice services in markets where we already have a personal care presence. Since the acquisition of Ambercare in 2018, we have been looking for additional opportunities to expand our hospice services, and we are delighted to have this opportunity to combine a well-regarded hospice operation like Hospice Partners of America with our existing operations. Importantly, this will also provide a strategic initial entry for Addus into the Texas market, which will provide potential growth opportunities.
“We look forward to Hospice Partners of America’s management team and clinical staff joining our Addus family, as we leverage our combined capabilities to develop a national platform for hospice services. Importantly, we share the same mission to provide quality, compassionate healthcare services to more consumers in their homes. We believe this is a good strategic fit, which should facilitate a smooth integration. Furthermore, we expect this transaction to be immediately accretive to our 2019 financial results,” said Allison.
Norma English, Chief Executive Officer of Hospice Partners of America, commented, “We are excited to join the Addus family. We believe that their commitment to quality is firmly aligned with Hospice Partners of America’s goal of providing outstanding end of life care. Joining the extensive Addus care network will accelerate our ability to enter new markets and provide hospice services to more patients. We are also very excited about the growth opportunities that being part of the Addus family will offer our employees.”
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Mr. Allison added, “This acquisition, along with the other three acquisitions we have closed in 2019, brings our total acquired annualized revenues to approximately $130.0 million. Our development team continues to identify additional opportunities within our strong acquisition pipeline, which we expect will allow us to extend our market reach and further strengthen our competitive position. Furthermore, this acquisition broadens and expands our acquisition pipeline in new markets where Hospice Partners of America operates today.”
Raymond James Health Care Banking acted as financial advisor to Addus.
Date: September 03, 2019
Source: Market Screener
