Kindred Healthcare, Inc. (NYSE: KND) announced its subsidiary signed a definitive agreement to acquire the equity of Professional HealthCare for $51 million in cash.
Professional is a provider of home health, hospice, and private duty nursing services and durable medical equipment with 27 locations in California, Arizona, Nevada, and Utah. According to Kindred, the company is generating revenues of approximately $53 million annually.
The deal will be anise addition to Kindred, which currently operates 21 nursing and rehabilitation centers and four long-term acute care hospitals within Professional’s service areas.
“The Professional transaction adds to the size and scale of our growing home health and hospice business,” said Paul J. Diaz, president and CEO of Kindred. “There is substantial overlap with Kindred’s businesses in many of Professional’s markets, which will allow us to expand our continuum of post-acute services in these cluster markets.
“We believe that the continued expansion of our continuum of post-acute care services in our key cluster markets supports the growing interest among patients, physicians, hospital systems and public and private payors for integrated care.”
Mr. Diaz continued, “We look forward to Professional’s employees joining our organization and contributing their expertise in the home health and hospice business. We in turn believe we can provide our new colleagues with enhanced opportunities for professional growth and development.”
Houlihan Lokey is acting as financial advisor to Kindred and Cain Brothers & Company, LLC is acting as financial advisor to Professional.
The transaction is subject to several regulatory approvals and other conditions to closing and is expected to close by the end of the third quarter of 2011. The Company expects that the transaction will be slightly accretive to earnings in 2012.