The GEO Group (NYSE:GEO) (“GEO”), a world leader in the delivery of correctional, detention, and mental health services, announced today that its mental health subsidiary, GEO Care, Inc. (“GEO Care”), has signed a definitve agreement to acquire Just Care, Inc. (“Just Care”), a provider of detention healthcare focusing on the delivery of medical and mental health services, for approximately $40.0 million.
Just Care Operations
Just Care manages the 354-bed Columbia Regional Care Center (the “Facility”) located in Columbia, South Carolina. The Facility houses medical and mental health residents for the State of South Carolina and the State of Georgia as well as special needs detainees under custody of the U.S. Marshals Service and U.S. Immigration and Customs Enforcement. The Facility is operated by Just Care under a long-term lease with the State of South Carolina. The Facility generates operating margins comparable to GEO’s leased facilities.
George C. Zoley, Chairman and CEO of GEO stated, “We believe this acquisition is an excellent strategic fit with GEO Care and will help to promote our long term growth objectives through broadening our delivery platform as well as our client base. Just Care and its management team has done an exemplary job in developing its business over the past ten years and we plan to continue with such efforts going forward.”
Impact on GEO’s Financial Performance – Increased 2009 Guidance
The acquisition is expected to add approximately $30.0 million in annual revenues to GEO Care’s operations and to be accretive by approximately $0.04 per share on an annualized basis.
GEO is increasing its previously issued earnings guidance for 2009 by $0.03 per diluted share to a pro forma range of $1.37 to $1.39 to account for the impact of the acquisition of Just Care as well as higher than expected occupancy levels at a number of GEO facilities. GEO expects 2009 total revenues to be in the range of $1.113 billion to $1.123 billion, including approximately $106.0 million in construction revenues.