Insight By: Dominic Padula & Greg DiGioia
SAB Capital’s Dominic Padula and Greg DiGioia have exclusively listed an Amedisys Home Health and Hospice in Morristown, Tennessee, a leading tenant within the healthcare service line. Amedisys, a highly experienced operator, recently made headlines with the announcement of its definitive merger agreement with Option Care Health. Within the next few years, they have substantial plans to grow as a leading independent platform for home and alternative site care. According to Dominic Padula, Vice President of Investment Sales at SAB Capital, this matters from both an industry and a credit perspective for investors of the underlying real estate leased by these companies. “The merger highlights the current value and future potential of these service lines within the healthcare services sector, as well as establishes a credit upgrade of the tenancy with the likelihood of seeing the business lines of both companies integrated at existing locations. This integration will further solidify the importance of the physical real estate housing these services.”
Population and age are the biggest things we look at for the growth of this industry. The US has a record number of baby boomers aging into retirement, making it the perfect time for large providers to build out their business lines and bolster their market share.
SAB Associate Greg DiGioia agreed that both businesses are “preparing to see a record number of new patients in the coming years” and that “an estimated 10,000 baby boomers will hit retirement each day through 2030,” according to a recent statistic in Senior Living.
Combining Amedisys’ home health and hospice care services with Option Care Health’s infusion services for home and alternative sites will establish a leading independent platform for home and alternate site care. With a nationwide workforce of over 16,500 professionals and 674 care centers, the merged company is dedicated to delivering top-quality care. This consolidation enables the company to expand its value-based care model, benefitting patients, families, providers, and care teams nationwide. The recently reported financial results for 2022 show combined revenues of approximately $6.2 billion and adjusted EBITDA of around $622 million.
“Our mission is to transform health care by providing innovative services that improve outcomes, reduce costs, and deliver hope and dignity for patients and their families. With the addition of Amedisys, we will bolster our offerings to meet the growing demand for personalized care in the home and alternative sites that move us closer to achieving this goal,” said John C. Rademacher, President and Chief Executive Officer of Option Care Health. “We look forward to working closely with the Amedisys team to build on our strong track record of operational integration as we bring our companies together to create significant long-term value for stockholders.”
For more insight on the home health investment space, reach out to:
Dominic Padula | Vice President | Investment Sales : 646.809.8843 | dpadula@sabcap.com
Greg DiGioia | Associate | Investment Sales : 646.817.2821 | gdigioia@sabcap.com
