Addus HomeCare Corporation (Nasdaq: ADUS) announced Thursday that it has acquired Tennessee Quality Care — a home health, hospice and private duty nursing provider.
The price tag was $106 million.
Tennessee Quality Care serves an average daily census of about 1,800 patients through 17 locations, and was formerly owned by American Health Partners.
The provider’s biggest service line is home health care, but it also provides private-duty nursing and hospice care.
“We are pleased to expand our market presence in Tennessee with the addition of the Tennessee Quality Care operations,” Addus Chairman and CEO Dirk Allison said in a statement. “This acquisition fits squarely into our growth strategy to leverage our strong personal care presence and add clinical services in key markets. We are excited to add approximately $40 million in annualized revenues in the state with this acquisition.”
The Frisco, Texas-based Addus currently provides home-based care services to about 47,500 individuals through 203 locations across 22 states.
The acquisition is the latest example of Addus’ commitment to build out the three legs of the stool – home health care, personal care and hospice care – in its markets.
Addus specifically wants to continue gearing its acquisitions toward home health care and personal care, the latter of which makes up the vast majority of its business.
“We are pleased with the opportunity to have Tennessee Quality Care join Addus and continue to expand its important work providing quality home health services and premium end-of-life care in the home setting,” Michael Bailey, CEO of American Health Partners, said in a statement. “This combination will benefit everyone associated with Tennessee Quality Care, especially the patients, families, and employees.”
Addus expects to close the transaction in the third quarter of 2023 and will fund the acquisition through a combination of cash on hand and the company’s revolving credit facility.
Tennessee is a certificate-of-need (CON) state, which makes the asset all that more valuable. Providers wishing to grow their footprints in CON states generally need to do so through acquisitions of existing assets.
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