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ADUS Positive Sentiment Score: 85/100

Brian W. Poff Dru Anderson Executive Vice President, FINN Partners Chief Financial Officer (615) 324-7346 Addus HomeCare Corporation dru.anderson@finnpartners.com (469) 535-8200 investorrelations@addus.com ADDU

Key Takeaway: Addus HomeCare Corporation announced a definitive agreement to acquire the personal care operations of Gentiva for approximately $350 million. This acquisition is expected to add annual revenues of about $280 million and will significantly expand Addus's presence in Texas and Missouri, where it currently has no operations. The transaction aligns with Addus's growth strategy and is projected to be accretive to its financial results. Regulatory approvals are required before the deal can be finalized.

Market Sentiment Analysis

POSITIVE FACTORS

  • Addus HomeCare's acquisition expands its market presence significantly.
  • The transaction is expected to add approximately $280 million in annual revenues.
  • Gentiva's established reputation will enhance Addus's service quality.
  • The acquisition aligns with Addus's growth strategy and is expected to be accretive to financial results.

Full Press Release Details

Contacts: Brian W. Poff Dru Anderson
Executive Vice President, FINN Partners
Chief Financial Officer (615) 324-7346
Addus HomeCare Corporation dru.anderson@finnpartners.com
(469) 535-8200 investorrelations@addus.com
ADDUS HOMECARE ANNOUNCES DEFINITIVE
AGREEMENT TO ACQUIRE PERSONAL CARE OPERATIONS OF GENTIVA
Company to Add Annualized Revenues of Approximately $280 Million in Seven
States and Enter Texas as the State s Largest Personal Care Provider
Frisco, Texas (June 10, 2024) Addus HomeCare Corporation (Nasdaq: ADUS), a provider of home care services, today announced a definitive
agreement to acquire the personal care operations of Gentiva for an anticipated purchase price, after customary purchase price adjustments, of approximately $350 million. Based in Atlanta, Georgia, Gentiva is a dedicated hospice, palliative,
and personal care services company and the transaction relates only to its personal care operations, which serve over 16,000 patients per day in a seven-state service area of Arizona, Arkansas, California, Missouri, North Carolina, Tennessee and
Texas. Addus expects to close the transaction following completion of regulatory approvals and subject to customary closing conditions. Addus will fund the acquisition through the Company s existing revolving credit facility.
Commenting on the announcement, Dirk Allison, Chairman and Chief Executive Officer of Addus, stated, We believe this acquisition is a great strategic
fit for Addus, and we are excited about the opportunity to expand our personal care market coverage in seven states, including Texas and Missouri, which are new markets for Addus. Notably, Gentiva is the largest provider of personal care services in
the state of Texas, where we currently have no personal care operations. This acquisition fits squarely into our growth strategy to leverage our strong personal care experience to build scale in existing markets as well as enter select new markets
where we can immediately establish a significant presence. Founded in 1999, Gentiva has an established reputation for quality, compassionate care, and we will continue this important work through our proven operating model. We look forward to
working with the experienced operational leadership team and clinical staff in Gentiva s personal care operations, who share our mission to provide safe, cost-effective care in the preferred home setting.
The Gentiva personal care operations have annualized revenues of approximately $280.0 million, and we expect this transaction to be accretive to
our financial results. Importantly, after funding this acquisition, Addus will still maintain a leverage ratio of less than three times, with the ability to quickly reduce our leverage through the additional expected cash flow, said Allison.
David Causby, Chief Executive Officer of Gentiva, added, A recognized leader in personal care services, Addus is the right home for our personal
care division and our teammates who provide care to these important clients. This will ensure continued growth for that segment under proven leadership and will allow us to sharpen our focus on our industry-leading core hospice and palliative
businesses, where we have the greatest opportunity to deliver the compassionate care that defines who we are, to those who need us the most.
Addus HomeCare Announces Definitive Agreement to Acquire Personal Care Operations of Gentiva
Allison added, Acquisitions remain an important part of our growth strategy, and we will continue to
pursue strategic acquisitions that meet our criteria and are accretive to our operations. Fortunately, our strong capital structure supports our strategy, and we look forward to additional opportunities ahead for Addus.
BofA Securities, Inc. is serving as an exclusive financial advisor and Bass Berry & Sims PLC is serving as legal counsel to Addus in this
transaction. Goldman Sachs & Co. LLC is serving as financial advisor and Debevoise & Plimpton LLP and Ropes & Gray LLP are serving as legal counsel to Gentiva.
Forward-Looking Statements
Certain matters discussed in
this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may be identified by words such as preliminary, continue,
expect, and similar expressions. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. Forward-looking statements involve a number of risks and
uncertainties that may cause actual results to differ materially from those expressed or implied by such forward-looking statements, including discretionary determinations by government officials, the consummation and integration of acquisitions,
transition to managed care providers, our ability to successfully execute our growth strategy, unexpected increases in SG&A and other expenses, expected benefits and unexpected costs of acquisitions and dispositions, management plans related to
dispositions, the possibility that expected benefits may not materialize as expected, the failure of the business to perform as expected, changes in reimbursement, changes in government regulations, changes in Addus HomeCare s relationships
with referral sources, increased competition for Addus HomeCare s services, changes in the interpretation of government regulations, the uncertainty regarding the outcome of discussions with managed care organizations, changes in tax rates, the
impact of adverse weather, higher than anticipated costs, lower than anticipated cost savings, estimation inaccuracies in future revenues, margins, earnings and growth, whether any anticipated receipt of payments will materialize, any security
breaches, cyber-attacks, loss of data or cybersecurity threats or incidents, and other risks set forth in the Risk Factors section in Addus HomeCare s Annual Report on Form 10-K filed with the Securities
and Exchange Commission on February 27, 2024, which is available at www.sec.gov. The financial information described herein and the periods to which they relate are preliminary estimates that are subject to change and finalization. There
is no assurance that the final amounts and adjustments will not differ materially from the amounts described above, or that additional adjustments will not be identified, the impact of which may be material. Addus HomeCare undertakes no obligation
to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In addition, these forward-looking statements necessarily depend upon assumptions, estimates and dates that may be incorrect or
imprecise and involve known and unknown risks, uncertainties, and other factors. Accordingly, any forward-looking statements included in this press release do not purport to be predictions of future events or circumstances and may not be realized.
About Addus HomeCare
Addus HomeCare is a provider
of home care services that primarily include personal care services that assist with activities of daily living, as well as hospice and home health services. Addus HomeCare s consumers are primarily persons who, without these services, are at
risk of hospitalization or institutionalization, such as the elderly, chronically ill and disabled. Addus HomeCare s payor clients include federal, state, and local governmental agencies, managed care organizations, commercial insurers, and
private individuals. Addus HomeCare currently provides home care services to over 49,000 consumers through 214 locations across 22 states. For more information, please visit www.addus.com.
Addus HomeCare Announces Definitive Agreement to Acquire Personal Care Operations of Gentiva
Gentiva is a family of industry-leading home healthcare providers, including hospice, palliative, home health, and personal care, with more than 590 locations
and thousands of compassionate clinicians and caregivers across 38 states. From assistance with daily living and restorative care to helping patients and their families manage the effects of serious illness or a terminal diagnosis, our place is by
the side of those who need us. Gentiva s corporate headquarters is in Atlanta, Georgia, with providers delivering care across the U.S.

Frequently Asked Questions

What is the acquisition announced by Addus HomeCare?

Addus HomeCare is acquiring Gentiva's personal care operations for about $350 million.

How much revenue will Gentiva's operations add to Addus?

Gentiva's personal care operations will contribute approximately $280 million annually.

In which states will Addus expand its operations?

Addus will expand its operations in Arizona, Arkansas, California, Missouri, North Carolina, Tennessee, and Texas.

What is Gentiva known for?

Gentiva is recognized for its hospice, palliative, and personal care services.

Who advised Addus during the acquisition?

BofA Securities is serving as the exclusive financial advisor to Addus in this transaction.

Last updated: Jun 10, 2024