- Second Divestiture This Month Further Sharpens Focus on High Growth, Sustainable, Low Risk Healthcare Services Businesses -
TORONTO, June 24, 2014 /CNW/ - Centric Health Corporation ("Centric Health") (TSX: CHH), Canada's leading diversified healthcare company, today announced that it has entered into a definitive agreement to sell substantially all of the assets of the Company's methadone pharmacy operations, referred to as the DNPI Group ("DNPI"), to a consortium of healthcare investors, for $20 million.
"The divestiture of DNPI represents the next step in the evolution of business, further optimizing our portfolio to focus on our core strengths and best opportunities," said David Cutler, President and Chief Executive Officer. "With $70 million in combined proceeds from this transaction and the recently announced sale of our retail medical equipment operations, we are well positioned to invest in businesses with strong cash flows, high margins and limited regulatory and funding risk that address our focus on servicing growing needs for innovative healthcare solutions."
Mr. Cutler added, "The divestiture also provides us with additional flexibility as we move forward in our debt reduction strategy."
The purchase price of $20 million will be settled entirely in cash. The sale is subject to certain regulatory approvals, as well as customary closing conditions, and is expected to close sometime in August 2014.
Centric Health purchased the DNPI Group assets for $9.7 million from receivership in August of 2011. Under the strong leadership of Centric Health management, the business has since expanded to a network of 12 specialty pharmacies servicing 36 methadone treatment centres across Ontario that provide access to treatment and care for patients undergoing methadone maintenance treatment.
Following the close of the transaction, Centric Health's Specialty Pharmacy segment will consist primarily of its seniors home pharmacy operations, which provide medication dispensing and consulting services to more than 200 long-term care and retirement homes in Ontario with more than 20,000 residents through five distribution centres.
Centric Health Investor Day - Tuesday June 24th in Toronto
Centric Health will host its 2014 Investor Day on Tuesday, June 24th from 9:00 a.m. to 11:00 a.m. at St. Andrew's Club in Toronto. To register, email Danielle Babineau at email@example.com.
For those unable to attend the event in person, a live webcast will be available on the Centric Health web site at http://www.centrichealth.ca/investors/events-and-presentations.
About Centric Health
Centric Health's vision is to be Canada's premier healthcare company, providing innovative solutions centered on patients and healthcare professionals. As a diversified healthcare company with investments in several niche service areas, Centric Health currently has operations in medical assessments, disability and rehabilitation management, physiotherapy and surgical centres, homecare, specialty pharmacy and wellness and prevention. With knowledge and experience of healthcare delivery in international markets and extensive and trusted relationships with payers, physicians, and government agencies, Centric Health is pursuing expansion opportunities into other healthcare sectors to create value for all stakeholders with an unwavering commitment to the highest quality of care. Centric Health is listed on the TSX under the symbol CHH. For further information, please visit www.centrichealth.ca.
This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding business strategy, plans and other expectations, beliefs, goals, objectives, information and statements about possible future events. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by Centric Health and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits Centric Health will derive there-from.
SOURCE: Centric Health Corporation
For further information:
Chief Financial Officer
416-815-0700 ext. 257