Company to Add Annualized Revenues of
Approximately $280 Million in Seven States and Enter Texas as the
State’s Largest Personal Care Provider
Addus HomeCare Corporation (Nasdaq: ADUS), a provider of home
care services, today announced a definitive agreement to acquire
the personal care operations of Gentiva for an anticipated purchase
price, after customary purchase price adjustments, of approximately
$350 million. Based in Atlanta, Georgia, Gentiva is a dedicated
hospice, palliative, and personal care services company and the
transaction relates only to its personal care operations, which
serve over 16,000 patients per day in a seven-state service area of
Arizona, Arkansas, California, Missouri, North Carolina, Tennessee
and Texas. Addus expects to close the transaction following
completion of regulatory approvals and subject to customary closing
conditions. Addus will fund the acquisition through the Company’s
existing revolving credit facility.
Commenting on the announcement, Dirk Allison, Chairman and Chief
Executive Officer of Addus, stated, “We believe this acquisition is
a great strategic fit for Addus, and we are excited about the
opportunity to expand our personal care market coverage in seven
states, including Texas and Missouri, which are new markets for
Addus. Notably, Gentiva is the largest provider of personal care
services in the state of Texas, where we currently have no personal
care operations. This acquisition fits squarely into our growth
strategy to leverage our strong personal care experience to build
scale in existing markets as well as enter select new markets where
we can immediately establish a significant presence. Founded in
1999, Gentiva has an established reputation for quality,
compassionate care, and we will continue this important work
through our proven operating model. We look forward to working with
the experienced operational leadership team and clinical staff in
Gentiva’s personal care operations, who share our mission to
provide safe, cost-effective care in the preferred home
setting.
“The Gentiva personal care operations have annualized revenues
of approximately $280.0 million, and we expect this transaction to
be accretive to our financial results. Importantly, after funding
this acquisition, Addus will still maintain a leverage ratio of
less than three times, with the ability to quickly reduce our
leverage through the additional expected cash flow,” said
Allison.
David Causby, Chief Executive Officer of Gentiva, added, “A
recognized leader in personal care services, Addus is the right
home for our personal care division and our teammates who provide
care to these important clients. This will ensure continued growth
for that segment under proven leadership and will allow us to
sharpen our focus on our industry-leading core hospice and
palliative businesses, where we have the greatest opportunity to
deliver the compassionate care that defines who we are, to those
who need us the most.”
Allison added, “Acquisitions remain an important part of our
growth strategy, and we will continue to pursue strategic
acquisitions that meet our criteria and are accretive to our
operations. Fortunately, our strong capital structure supports our
strategy, and we look forward to additional opportunities ahead for
Addus.”
BofA Securities, Inc. is serving as an exclusive financial
advisor and Bass Berry & Sims PLC is serving as legal counsel
to Addus in this transaction. Goldman Sachs & Co. LLC is
serving as financial advisor and Debevoise & Plimpton LLP and
Ropes & Gray LLP are serving as legal counsel to Gentiva.
Forward-Looking Statements
Certain matters discussed in this press release constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements may be identified by words such as “preliminary,”
“continue,” “expect,” and similar expressions. These
forward-looking statements are based on our current expectations
and beliefs concerning future developments and their potential
effect on us. Forward-looking statements involve a number of risks
and uncertainties that may cause actual results to differ
materially from those expressed or implied by such forward-looking
statements, including discretionary determinations by government
officials, the consummation and integration of acquisitions,
transition to managed care providers, our ability to successfully
execute our growth strategy, unexpected increases in SG&A and
other expenses, expected benefits and unexpected costs of
acquisitions and dispositions, management plans related to
dispositions, the possibility that expected benefits may not
materialize as expected, the failure of the business to perform as
expected, changes in reimbursement, changes in government
regulations, changes in Addus HomeCare’s relationships with
referral sources, increased competition for Addus HomeCare’s
services, changes in the interpretation of government regulations,
the uncertainty regarding the outcome of discussions with managed
care organizations, changes in tax rates, the impact of adverse
weather, higher than anticipated costs, lower than anticipated cost
savings, estimation inaccuracies in future revenues, margins,
earnings and growth, whether any anticipated receipt of payments
will materialize, any security breaches, cyber-attacks, loss of
data or cybersecurity threats or incidents, and other risks set
forth in the Risk Factors section in Addus HomeCare’s Annual Report
on Form 10-K filed with the Securities and Exchange Commission on
February 27, 2024, which is available at www.sec.gov. The financial
information described herein and the periods to which they relate
are preliminary estimates that are subject to change and
finalization. There is no assurance that the final amounts and
adjustments will not differ materially from the amounts described
above, or that additional adjustments will not be identified, the
impact of which may be material. Addus HomeCare undertakes no
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
In addition, these forward-looking statements necessarily depend
upon assumptions, estimates and dates that may be incorrect or
imprecise and involve known and unknown risks, uncertainties, and
other factors. Accordingly, any forward-looking statements included
in this press release do not purport to be predictions of future
events or circumstances and may not be realized.
About Addus HomeCare
Addus HomeCare is a provider of home care services that
primarily include personal care services that assist with
activities of daily living, as well as hospice and home health
services. Addus HomeCare’s consumers are primarily persons who,
without these services, are at risk of hospitalization or
institutionalization, such as the elderly, chronically ill and
disabled. Addus HomeCare’s payor clients include federal, state,
and local governmental agencies, managed care organizations,
commercial insurers, and private individuals. Addus HomeCare
currently provides home care services to over 49,000 consumers
through 214 locations across 22 states. For more information,
please visit www.addus.com.
About Gentiva
Gentiva is a family of industry-leading home healthcare
providers, including hospice, palliative, home health, and personal
care, with more than 590 locations and thousands of compassionate
clinicians and caregivers across 38 states. From assistance with
daily living and restorative care to helping patients and their
families manage the effects of serious illness or a terminal
diagnosis, our place is by the side of those who need us. Gentiva’s
corporate headquarters is in Atlanta, Georgia, with providers
delivering care across the U.S.
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version on businesswire.com: https://www.businesswire.com/news/home/20240610676671/en/
Brian W. Poff Executive Vice President, Chief Financial Officer
Addus HomeCare Corporation (469) 535-8200
investorrelations@addus.com
Dru Anderson FINN Partners (615) 324-7346
dru.anderson@finnpartners.com
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