Monday, January 19, 2015

Kindred to Consummate Gentiva Transaction


Kindred talked about the impending takeover of Gentiva at the J.P. Morgan Annual Healthcare Conference:

Secondly, as part of consummating the Gentiva transaction which we announced publicly, we expect to close on February 2 here. So just in a couple of weeks. We will become the largest provider of home health and hospice in the country. Well over $2 billion of revenue, approaching almost $2.5 billion of revenue. Included in that is about $850 million of hospice revenue, the rest of it being on the home health, skilled nursing side and personal care side in a place that as we will talk more about our integrated care strategy, we at Kindred Healthcare believe that as the consumer continues to be more responsible for their first dollar out of pocket, as medical technology continues to improve and as our ability to continue to take care of a patient at the end of their stay grows that being able to provide care in the home is going to be more and more important in the future of healthcare delivery. And so being the largest in the home care space is very, very important to us as well. 
That's twelve days before Valentine's Day.  Time will show how much love Kindred shows Gentiva employees. Here's the close from Kindred's President and CEO Ben Breier:

As I mentioned earlier, not only you know are we confident in the work that we’re doing today in the context of integration, but that we believe that this is moving us into higher revenue growth businesses, as I mentioned earlier with higher EBITDA margins, better growth rate characteristics than what we’ve ever had at any other time in the history of Kindred. 

We take a lot of pride and spend a lot of time thinking about the leverage aspects of our Company and we’re going to work hard, investors, equity investors should note we’re going to spend a lot of time this year and beyond thinking about the continued focus on delevering our Company. We’re in a reasonable position now, but certainly as we start to grow into Gentiva, we’d like to get that leverage number into sort of the 5 times range and ultimately as we get through the first two years of the Gentiva close, we think that investors should expect us to be sort of more in the 4.5 range from a leverage perspective. 

 And so last — just from I think to a close from an investment perspective and an investment rationale perspective you know, we aspire to do really what we hope are amazing things inside of the healthcare delivery system. We really do think that we’re in a position to reshape the way healthcare is delivered for an aging population in America which we take very importantly. We think that, as I mentioned, we’re uniquely positioned in a fee-for-service world today to move our fee-for-service business into more of a value-based purchasing environment where over the course of the next couple of years, people will want to pay us for taking care of a patient more broadly. This continue the care strategy that we have developed, we think is absolutely a strategic advantage to how we deliver care out in the marketplace. If you think about our business today and how it compares to any of our competitors out there really, there is nobody that has the deep local market penetration with the broad national scale that we have to manage costs but really develop brand and be able to take care of patients all across the continuum like Kindred Healthcare does. 

 And as we continue to connect the dots on health information, IT, and on care coordination, we will continue to be much more effective at how we manage these patients. You know we’ve had transformational growth, there’s no question about it. I mean, both doing Gentiva and Centerre, it represents, I think, certainly the strength of the back office of our Company and our ability to integrate these businesses. And so this transformational growth you will continue to see play out over the course of 2015 which will have a strong growth profile with, as I said, improving margin characteristics. We will have you know what we think are substantial operating cash flow possibilities with a deleveraging profile

Warms the hospice heart doesn't it?

Anonymous (from Gentiva)


  1. At corporate, we are supposed to be getting letters tomorrow telling us how long we have. The distribution date of these letters has been bumped several times since December.

  2. The expected termination date was referenced in the most recent edition of Better Together. I wonder how many employees feel Better about the deal, other than senior executives making millions.