Amedisys, Inc. (NASDAQ:AMED) has completed its acquisition of Homecare Preferred Choice, Inc., doing business as AseraCare Hospice. Amedisys acquired 100% ownership of AseraCare for a cash price of $235 million.
AseraCare operates 44 hospice locations throughout 14 states with an average daily census that exceeds 2,100. The company generates $117 million in revenue annually.
With this transaction Amedisys’ hospice operations have grown to include 190 care centers in 35 states for a combined average daily census of more than 14,000. The transaction will also bring Amedisys hospice services to new markets.
“This asset is a great addition to our portfolio. We have followed AseraCare for a number of years and have always been impressed with the culture and the quality of their operations as well as their management. This — along with their complementary geographic footprint — makes our two organizations a great fit,” Amedisys CEO Paul Kusserow said in a presentation at the 2020 Jefferies Virtual Healthcare Conference. “Since we developed our three pronged inorganic hospice strategy, which included larger hospice deals, tuck-ins and de novos, we have executed on each of these prongs.”
Amedisys was active in the hospice M&A market during 2019, completing several transactions that included its $340 million purchase of Compassionate Care Hospice in February and its tuck-in of RoseRock Healthcare for an undisclosed amount.
The company kicked off the new year with another acquisition, closing its purchase of Asana Hospice for an undisclosed amount on Jan 1. Asana Hospice, which operates eight locations in Pennsylvania, Ohio, Missouri, Kansas and Texas, had an average daily census of 540.
Amedisys has opened hospice eight de novos in addition to six home health, according to Kusserow.
“In total, our inorganic hospice growth strategy accounts for the addition of over 6,000 [average daily census] to our hospice business,” he said at Jeffries. “I am very proud of the way we have executed against our hospice plan. We will now take some time to complete the integrations and to refine the operations of our newly acquired businesses and make everything one.”
Amedisys’ hospice segment brought in $38.3 million during the first quarter of 2020, representing an increase of $4.8 million from the prior year’s quarter. Revenues for the hospice segment rose 23.1% year-over-year, largely driven by the Compassionate Care acquisition, which made the company the third-largest hospice provider in the nation.