Addus Homecare buttons up $350 million Gentiva acquisition
The goal is to expand coverage in existing markets and expand into new ones, Addus CEO says.
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Addus Homecare, a provider of home care services, has completed a $350 million acquisition of the personal care operations of Gentiva, which provides hospice, palliative and personal care services in the seven-state service area of Arizona, Arkansas, California, Missouri, North Carolina, Tennessee and Texas.
Addus funded the acquisition through a combination of cash on hand, representing a portion of the proceeds of the company's recent public offering of common stock, and its existing revolving credit facility.
WHAT'S THE IMPACT?
Addus Chairman and CEO Dirk Allison said adding Gentiva's personal care operations will greatly expand the former's market coverage in those seven states, particularly in Texas and Missouri, which are new markets for the company.
With the move, Addus will be the largest provider of personal care services in Texas, Allison said, adding that transition teams at both enterprises have been working together over the past six months to facilitate a smooth integration.
"With our shared experience and expertise, we are well positioned to leverage the strength of the combined operations and provide more consumers and their families with safe, cost-effective care in the preferred home setting," he said.
THE LARGER TREND
Allison expects the deal to be accretive to Addus' financial results, adding annualized revenues of approximately $280 million.
This aligns with the company's strategy to build up its scale in existing markets and expand into new ones, with additional acquisitions eyed for the future.
"We have the capital structure and financial flexibility to support our growth strategy in 2025 and beyond," said Allison.
Jeff Lagasse is editor of Healthcare Finance News.
Email: jlagasse@himss.org
Healthcare Finance News is a HIMSS Media publication.
