HealthSouth to acquire home health agency operations of CareSouth Health System

NewsGuard 100/100 Score

HealthSouth Corporation (NYSE: HLS) ("HealthSouth"), a leading provider of post-acute healthcare services, today announced its Encompass Home Health operating unit ("Encompass") has entered into a definitive agreement to acquire the home health agency operations of CareSouth Health System, Inc. ("CareSouth") for a cash purchase price of $170 million. CareSouth operates a portfolio of 45 home health locations in 7 states and generated revenues of approximately $104 million in 2014. The transaction was approved by both companies' boards of directors and is expected to close in the fourth quarter of 2015, subject to regulatory approval. HealthSouth expects to fund the transaction with cash on hand and borrowings under its senior secured credit facility.

The CareSouth acquisition enables HealthSouth to leverage the operating platform of Encompass across home health locations in the new markets of Alabama, Georgia, North Carolina, South Carolina, and Tennessee. CareSouth also improves Encompass' market share position in the key states of Florida and Virginia. Upon completion of this transaction, Encompass will become the third largest home health provider in Virginia and the ninth largest home health provider in Florida. These new home health locations will overlap with fourteen of HealthSouth's existing inpatient rehabilitation hospitals. The addition of these assets will allow HealthSouth to better serve the post-acute needs of patients in those markets by offering both facility-based and home-based post-acute services.

"We are very pleased to be joining forces with a great organization like CareSouth. By combining the CareSouth and Encompass teams, we will further our mission of providing a better way to care," said April Anthony, Chief Executive Officer of Encompass. "We have respected the CareSouth management team for some time and are confident our cultures and philosophies will align well."

The closing of the transaction is subject to certain customary closing conditions and regulatory approvals, including expiration or termination of all applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act. HealthSouth intends to address the effects of this acquisition on its Adjusted EBITDA and earnings per share after the transaction closes.


The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of News Medical.
Post a new comment

While we only use edited and approved content for Azthena answers, it may on occasions provide incorrect responses. Please confirm any data provided with the related suppliers or authors. We do not provide medical advice, if you search for medical information you must always consult a medical professional before acting on any information provided.

Your questions, but not your email details will be shared with OpenAI and retained for 30 days in accordance with their privacy principles.

Please do not ask questions that use sensitive or confidential information.

Read the full Terms & Conditions.

You might also like...
Top minds in multiple sclerosis to speak at CMSC 38th Annual Meeting