– Strategic Acquisition Immediately Accretive with Further Potential through Increased Synergies, Scale, and Efficiency –
TORONTO, Nov. 15, 2017 /CNW/ - Centric Health Corporation ("Centric Health" or the "Company") (TSX:CHH) today announced that it has entered into an asset purchase agreement to acquire Salus Pharmacare ("Salus"), a specialty pharmacy in Calgary, Alberta, presently serving over 700 assisted living beds with potential to service another 700 seniors in independent living facilities. The acquisition will increase the Company's market share in Calgary and makes it a leading pharmacy provider to assisted living and long-term care homes in Alberta.
"This is an important acquisition that allows us to continue to build scale and is aligned with our strategy to grow in Western Canada," said David Cutler, President and Chief Executive Officer, Centric Health. "To further solidify our presence in Calgary and our ability to win further contracts, we intend to combine Salus' operations with our Pharmacare team in a new larger facility, which we expect will generate synergies and position us to meet expected growth in the market."
Salus had trailing 12-month Adjusted EBITDA* of $0.6 million. Total consideration on closing is $2.075 million consisting of $1.4 million in cash and 613,636 shares with price protection of $1.10 per share. Additional consideration consists of up to $2.3 million in cash and shares based on the achievement of certain performance benchmarks over the next three years. With this acquisition, Centric Health's pharmacy business will add efficiency to its network of 20 pharmacies, 17 of which are specialty pharmacy packaging fulfillment centres with mobile clinical pharmacy teams across four provinces— the largest specialty pharmacy network in Canada. The new pharmacy operation will be merged with one of the Company's existing operations in Calgary, Alberta.
This transaction will be immediately accretive to Adjusted EBITDA, and will provide additional growth opportunities through the realization of scale and synergies in the merged facility. The transaction is expected to close on or about November 15, 2017, subject to customary closing conditions.
About Centric Health
Centric Health's vision is to be Canada's most respected and recognized provider in the independent healthcare sectors in which it operates, world renowned for delivering the highest levels of quality care and outcomes, innovative solutions and value to patients, clients and stakeholders. To this end, Centric Health primarily focuses on two core healthcare businesses:
- The Specialty Pharmacy division is a "Patient First" model composed of a growing national network of fulfilment centres that deliver high-volume solutions for the cost effective supply of chronic medication and other specialty clinical care services, serving more than 29,000 residents in over 425 seniors communities (long-term care facilities, retirement homes and assisted living facilities) nationally. The Specialty Pharmacy division also provides pharmaceutical dispensing services for employees insured by corporate health plans.
- The Surgical & Medical Centres division is Canada's largest independent surgical provider operating five facilities across four provinces. It serves a diversified customer base with private paid non-insured surgeries and diagnostics, government outsourcing of insured surgeries and diagnostics and other procedures funded by third-party payors (including Workers Compensation) and is the proud owner of Canada's first Centre of Excellence in Metabolic and Bariatric Surgery.
With national networks of facilities in each of its businesses, deep knowledge and experience of healthcare delivery and extensive, trusted relationships with payers, physicians, and government agencies, the Company is uniquely positioned to address current and future healthcare needs in growing markets as the Canadian healthcare industry goes through a major transformation over the medium to long term. www.centrichealth.ca
*Non-IFRS Measures: This press release includes certain measures which have not been prepared in accordance with IFRS such as EBITDA and adjusted EBITDA. This data is furnished to provide additional information and are non-IFRS measures and do not have any standardized meaning prescribed by IFRS.
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 the timing and completion of the proposed acquisition, final financial breakdown, 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, including the completion of the transactions on the terms set out in the definitive agreement and in a manner consistent with management's expectations, the accuracy of management's assessment of the effects of the acquisition, and the ongoing performance of the business of Salus. These assumptions and estimates are not intended to represent a complete list of the assumptions and estimates that could affect the Company. 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. The Company does not undertake to update any forward-looking information contained herein, except as required by applicable Canadian securities legislation.
SOURCE Centric Health Corporation
For further information: David Cutler, Chief Executive Officer, Centric Health Corporation, 416-619-9401, [email protected]; Craig MacPhail, Investor Relations, NATIONAL Equicom, 416-586-1938, [email protected]