- people on the move
Rehab company selling US operations for $45M
A locally based network of physical rehabilitation clinics is selling its U.S. assets for $45 million.
Alliance Physical Therapy Management, a subsidiary of Tampa, Florida-based Alliance Physical Therapy Partners, is purchasing the domestic assets of Grand Rapids-based Agility Health, Inc.
Agility Health Holdings and Alaris USA will sell their respective membership interests in Agility Health, LLC, the owner of the U.S. assets, to Alliance.
Agility Health, Inc. said yesterday $25,095,488 will go to Alaris, and Agility Health Holdings will receive $19,904,512.
The deal is expected to close this month.
All 1,200 U.S. employees will keep their jobs, according to Wayne Cockburn, VP of corporate development for Agility Health, Inc. and Medic Holdings.
Agility Health, Inc. will retain about $1.3 million, which will go toward growing Medic Holdings Corp., Agility Health, Inc.’s Canadian subsidiary, which will constitute the primary business and asset of the company post-transaction.
Medic operates 12 outpatient foot care clinics across two provinces in eastern Canada and manufactures orthotics and prosthetics. Under the terms of the of the purchase agreement, Agility Health, Inc. is not able to engage in a U.S. business that competes with Agility Health, LLC for five years.
Cockburn said selling the U.S. operations was the best option to pay off the parent company’s roughly $45 million in debt.
“It’s a financial move,” Cockburn said. “We’re carrying too much debt for the size of the business.”
The company was previously making $100 million in sales but losing money, he said.
With the change, the company will be making C$16 million in sales and will have “positive” earnings before interest, taxes, depreciation and amortization, or EBITDA, he said.
“So often, companies are focused on the revenue and don’t pay enough attention to the bottom line, and that’s where companies can get themselves into trouble,” Cockburn said.
Agility Health, Inc. (TSXV: AHI) operates a multi-state network of outpatient rehabilitation clinics and provides contract services to hospitals, nursing homes and other institutional clients, providing care and treatment for orthopedic-related disorders, sports-related injuries, preventative care, rehabilitation of injured workers and a variety of other injuries and conditions.
Agility Health operates 84 outpatient or on-site rehabilitation locations in 16 states.
Agility Health's contract therapy services business provides rehabilitative services to 36 hospitals and inpatient rehabilitation units and 37 nursing homes, long-term care facilities and other service locations in 11 states.
Alliance Physical Therapy Partners
Alliance Physical Therapy Partners is a portfolio company of New York-based GPB Capital Holdings, a registered investment advisor with the SEC.
The goal of Alliance Physical Therapy Partners and GPB Capital is to increase the value of its holdings for shareholders by acquiring businesses in growth-related industries.