The acquisition will increase AdaptHealth’s footprint to 47 continental US states
AdaptHealth has agreed to acquire AeroCare, a US-based technology-enabled respiratory and home medical equipment (HME) provider, in a cash-cum-stock deal worth around $2bn.
As per the terms of the deal, AdaptHealth will pay $1.1bn in cash and issue 31 million shares of its common stock to AeroCare’s shareholders.
Currently, AeroCare is owned by private investors that include Peloton Equity, SV Health Investors, SkyKnight Capital, and also the company’s own management and employees.
Established nearly 20 years ago, AeroCare provides a suite of direct-to-patient equipment and services in more than 300 locations across 30 states in the US. Some of the medical equipment products it offers are continuous positive airway pressure (CPAP) and bilevel positive airway pressure (BiPAP) machines, home ventilators, and oxygen concentrators.
AdaptHealth also provides home healthcare equipment and medical supplies in the US. The company’s medical products and solutions help patients in managing their chronic conditions in the home.
AdaptHealth CEO Luke McGee said: “This highly accretive transaction pairs up two industry leaders with similar strategies and strong execution track records of growth and profitability, technology innovation, and patient service.
“Our combined company will further enhance our geographic reach with a footprint in 47 of the 48 continental US states, strengthening relationships with our referral partners, patients, manufacturers, and managed healthcare plans.”
Post-transaction, the combined company will operate as AdaptHealth.
Luke McGee and Steve Griggs, CEO of AeroCare, will be the co-CEOs of the enlarged company.
Griggs said: “Joining forces with AdaptHealth strengthens our combined ability to transform our industry and positively impact the lives of chronically ill patients across the country.
“I am very excited to partner with Luke, Josh and the AdaptHealth team to build an even stronger business, sharing best practices across each organization to drive operational efficiencies and create enhanced opportunities for our employees, patients, referral sources and other stakeholders.”
The deal, which is subject to regulatory approvals and customary closing conditions, is expected to be completed in Q1 2021.
In a separate development, AdaptHealth has completed the acquisition of Massachusetts-based New England Home Medical Equipment (NEHME). The acquired company supplies continuous glucose monitoring (CGM) and diabetes management supplies across New England and the Northeastern US.