AdCare Health Systems, one of the leading care providers in the senior living and health care facility management, announced today signature of a definitive $38.5M agreement, whereby ADK will acquire, lease and become manager of a 15 location network of nursing facilities, staffed with highly skilled personnel.
Located in Tennessee, Virginia and both Carolinas, this network of facilities represents some 2k beds and brings the total number of contract facilities under the Company’s control to 46. Impressive work by ADK, which began its mergers and acquisitions campaign back in the fall of 2009, subsequently amassing a small empire and culminating in this milestone purchase, the largest to date in the Company’s history. Of the facilities included in the agreement, two will be purchased outrightly while the remainder will be leased, with four of the facilities being directly managed by the Company.
Vice Chairman and Chief Acquisitions Officer for ADK, Chris Brogdon, illustrated how this move significantly expands the Company’s footprint in North Carolina and provides ready access to parallel markets in South Carolina, Virginia and Tennessee. Brogdon also explained that this expansion into the larger Southeastern US would benefit in terms of mobilization and overall logistical efficiency.
When this move is taken into account alongside the sum of all other extant and current transactions, ADK’s estimated annualized revenue run-rate is projected to exceed $268M, a 400% jump from 2010 figures and up more than 900% over 2009 revenues when the M&A campaign kicked off. ADK Shareholders understand these figures are a direct result of the Company’s overall model and direction, anticipating increased returns as the baby boomer generation continues to matriculate into the senior care market.
An upcoming conference call by ADK focusing on this transaction and hosted by the Company’s management will feature a Q&A session at the end, details of which are available at ADK’s website: www.adcarehealth.com