Addus HomeCare, a provider of home care services, announced a definitive agreement to acquire Gentiva’s personal care operations for an anticipated purchase price of approximately $350 million after customary purchase price adjustments.
Based in Atlanta, Georgia, Gentiva is a dedicated hospice, palliative, and personal care services company. The transaction relates only to its personal care operations, which serve 16,000+ patients daily in a seven-state service area that includes Arizona, Arkansas, California, Missouri, North Carolina, Tennessee, and Texas.
Addus expects to close the deal after regulatory approvals are completed and subject to customary closing conditions. It will fund the acquisition through the company’s existing revolving credit facility.
BofA Securities is an exclusive financial advisor, and Bass Berry & Sims serves as legal counsel to Addus in this transaction. Goldman Sachs is a financial advisor, and Debevoise & Plimpton and Ropes & Gray serve as legal counsel to Gentiva.
KEY QUOTES:
“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.”
“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.”
- Dirk Allison, Chairman and Chief Executive Officer of Addus
“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.”
- David Causby, Chief Executive Officer of Gentiva
