Addus HomeCare Corporation (NASDAQ: ADUS) has acquired personal care provider SunLife HomeCare in Tucson, Ariz., for an undisclosed amount. SunLife brings in annualized revenues of $2.6 million.
Expansion has been a priority for Addus as the company seeks to build a home health and hospice footprint that matches its personal care operations, its largest business line.
“We have now completed four acquisitions in 2020, despite the challenges and disruptions related to the COVID-19 pandemic,” said Addus President and CEO Dirk Allison. “Our development team has done an outstanding job in executing our acquisition strategy, adding total acquired annualized revenues of approximately $85 million to date this year.”
Addus financed the transaction with cash on hand as well as the company’s existing revolving credit facility.
The SunLife acquisition comes on the heels of Addus’ purchase of Queen City Hospice and its affiliate Miracle City Hospice for $192 million, which closed last week. Prior to the Addus deal Queen City was a portfolio company of the private equity firm Stonehenge Partners.
Addus’ growth strategy focuses on co-locating hospice and home health assets in markets in which they already have a substantial personal care presence. The company currently provides hospice, home health, and personal care services to nearly 44,000 patients through 215 locations in 25 states.
The company’s net service revenues for the third quarter totaled nearly $194 million, up 17% from $169 million in the prior year’s quarter. Their personal care business drew in the bulk of that revenue, about $165 million.
Addus had backed off pursuing acquisitions during the early stages of the COVID-19 pandemic, as did much of the hospice industry in the first and early second quarters. Industrywide, the M&A market started to rebound late in the second quarter and into the third.
Allison indicated Addus is on the lookout for additional hospice, home health and personal care deals.
“With a strong acquisition pipeline and a solid financial position to support our continued growth, we look forward to the opportunities ahead for Addus to extend our market reach and create greater value for our shareholders,” Allison said.