Acadia Healthcare (ACHC) Completes PIC Acquisition; Boosts FY14 EPS Outlook

Acadia Healthcare (Nasdaq: ACHC) announced that yesterday it completed the previously announced acquisition of Partnerships in Care (PiC) for approximately $662 million in cash. PiC is the second largest independent provider of inpatient behavioral healthcare services in the United Kingdom, operating 23 inpatient psychiatric facilities with over 1,200 beds. For 2013, PiC produced revenue of approximately $285 million and adjusted EBITDA of approximately $75 million. Acadia expects that the transaction will be accretive to its 2014 earnings in a range of $0.17 to $0.18 per diluted share, before transaction-related expenses.

Joey Jacobs, Chairman and Chief Executive Officer of Acadia, commented, “We are very pleased to enter the U.K. market for inpatient behavioral care with such a high quality provider and well-established market leader as PiC. We continue to believe that favorable market dynamics in the U.K. present a significant opportunity for accretive growth. With PiC’s strong management team, supported by Acadia’s experienced organization and access to capital, we are confident that we are well positioned to achieve our expectations for growth in the U.K., both organically and through additional acquisitions.”

The purchase was financed through a combination of equity and long-term debt. On June 17, 2014, Acadia closed an underwritten public offering of its common stock, which provided net proceeds to the Company of approximately $374 million. On July 1, 2014, Acadia closed a private offering of $300 million in aggregate principal amount of its 5.125% senior unsecured notes due 2022 pursuant to an exemption from the registration requirements of the Securities Act of 1933, as amended.

Brent Turner, President of Acadia, added, “As demonstrated by the successful completion of these offerings, Acadia’s long-term growth continues to be supported by its access to capital. While we are focused on the seamless integration of PiC into Acadia’s operations, we continue to evaluate additional opportunities in the U.S and U.K. to expand through acquisition. We believe we have the financial flexibility and strength to finance additional transactions. We expect our net cash flow from operations will be strengthened by increased margins and a lower consolidated income tax rate resulting from the integration of PiC’s operations into Acadia’s. We also have approximately $175 million in availability under our revolving credit facility.”

Based primarily on the impact of the PiC acquisition, Acadia today raised its guidance for 2014 adjusted earnings per diluted share to a range of $1.44 to $1.46. The Company’s guidance does not include the impact of any future acquisitions or transaction-related expenses.

*** The Street sees EPS of $1.36.

You May Also Be Interested In

• Intuitive Surgiical (ISRG) beats earnings, revenue expectations in Q1
• Equifax (EFX) shares tumble on weak Q1 revenue, guidance miss
• Chemung Financial (CHMG) Tops Q1 EPS by 44c