Illinois hospice provider JourneyCare going public through $85M acquisition
Not-for-profit JourneyCare, one of Illinois’ largest hospice providers, announced Wednesday it’s being purchased by publicly-traded Addus HomeCare for $85 million.
JourneyCare, based in Glenview, Illinois, serves about 750 patients per day across a 13-county region in the Chicago metro. The proposed deal, expected to close February 1, is part of Addus’ broader merger and acquisition strategy, which included last year’s addition of Summit Home Health, also in the Chicago area.
“We very carefully selected Addus to carry forward the JourneyCare clinical operations, and we believe this combination will benefit our employees, patients and everyone associated with JourneyCare,” JourneyCare CEO Kimberly Hobson said in a statement. “We share the same commitment to providing quality end of life care, and we look forward to working together to close this important transaction.”
JourneyCare’s spokesperson did not respond to requests for comment. Information the company shared with employees promised they would retain their current seniority, compensation and benefits under Addus’ ownership. The explainer said JourneyCare will keep its current name and branding.
JourneyCare also told employees that existing hospice, palliative and pediatric services would not change under the new ownership, although they would eventually transition to Addus’ electronic health records platform.
Headquartered in Frisco, Texas, Addus serves about 44,500 people in 22 states. The company has about 30,000 employees in clinical and administrative positions. It’s been on a buying spree in recent years, having also added New Mexico’s Armada Skilled Home Health and Hospice for $29 million last year. That’s on top of four acquisitions in 2020 and four in 2019.
Addus’ stock price fell more than 2% by Wednesday’s close. The company posted $33 million in net income on $765 million in revenue in 2020. Most of its hospice and home health revenue comes from Medicare: 93% and 79%, respectively.
Addus said it planned to fund the acquisition through a combination of cash on hand and its revolving credit facility. Addus CEO Dirk Allison said in a statement that the addition will be nominally accretive in the first year as it works through the integration process.
“Acquisitions are an important part of our growth strategy, and we are pleased to start 2022 on a strong note,” he said. “Our development team continues to do an outstanding job of identifying strategic acquisitions and our strong capital structure supports our ability to continue this successful track record.”