NOT FOR EXTERNAL DISTRIBUTION
SOURCE: Modern Healthcare
AUTHOR: Ginger Christ
HCA Healthcare will purchase the majority stake of Brookdale Senior Living's home health, hospice and outpatient therapy arm, the companies said Wednesday.
Under the agreement, Nashville-based HCA Healthcare will purchase 80% of Brookdale Health Care Services for $400 million, according to a news release. Brentwood, Tenn.-based Brookdale will keep a 20% equity interest.
Brookdale President and CEO Cindy Baier said the partnership with HCA Healthcare will ensure residents and patients still receive high-quality service, will strengthen the company's liquidity position and create opportunities for growth through an integration of services.
"We believe this opportunity to partner with Brookdale will expand the services we offer and enhance our ability to deliver a better experience for our patients as well as for Brookdale residents," HCA Healthcare CEO Sam Hazen said in a statement.
The Brookdale sale follows the December announcement by Encompass Health that the company was looking at options for its home health segment, including including a separation of the home health and hospice business through an initial public offering, spin-off, merger or sale.
Brookdale reported the sale with its fourth quarter and 2020 full year earnings. The company experienced a net loss of $44.1 million during the fourth quarter, which was an improvement from the $91.3 million Brookdale lost in during the same period in 2019. In 2020, Brookdale had net income of $81.9 million for the year, an improvement from the $268.9 million net loss the company had in 2019.
Brookdale Health Services operates 57 home health agencies and 22 hospice agencies in 26 states and 84 outpatient therapy locations. HCA Healthcare provides healthcare services at 2,000 different locations.