Great Elm (NASDAQ:GEG) stock jumped 35% after hours on Tuesday on the sale of its durable medical equipment business Great Elm Healthcare to QHM Holdings, a unit of Quipt Home Medical (QIPT), for $80M.
Shares of Quipt (QIPT) gained 8.1% aftermarket.
Great Elm Healthcare operates respiratory related durable medical equipment service locations across eight states.
The deal amount includes ~$73M of cash, $5M of assumed indebtedness and ~432K Quipt (QIPT) shares valued at $2M using a 20-day volume-weighted average price.
Want to publish your own articles on DistilINFO Publications?
Send us an email, we will get in touch with you.
Great Elm (GEG) received ~$26M in net cash proceeds and 346K Quipt (QIPT) shares.
The deal simplifies Great Elm’s (GEG) reporting and organizational structure, and provides capital to grow its investment management business.
Quipt (QIPT) and Great Elm Healthcare are expected to have combined annualized revenue and annualized adj. EBITDA of $220M and $47M, respectively.
Quipt (QIPT) identified $2M in cost savings and synergies, expected to be captured over the first six months. The deal is expected to be financially accretive to Quipt’s (QIPT) growth and cash flow.
With this acquisition, Quipt (QIPT) surpassed its outlook of achieving annualized revenue of $180M-$190M by the end of calendar 2022.
Earlier, Great Elm (GEG) sold its majority stake in Forest Investments to J.P. Morgan Broker-Dealer for ~$18M in cash.
Source: Seeking Alpha