STAMFORD, Conn., April 11, 2018 /PRNewswire/ -- The
Providence Service Corporation (the "Company" or "Providence") (Nasdaq: PRSC) today announced an
organizational consolidation plan to integrate substantially all
activities and functions currently performed at the corporate
holding company level into LogistiCare, the Company's largest
subsidiary and the nation's leader in non-emergency medical
transportation. The organizational consolidation will result in a
more streamlined company structure with greater operational and
strategic alignment and better able to pursue both organic and
inorganic growth initiatives. This strategic process is expected to
take approximately 12 months to complete, over which time
implementation costs will negatively impact earnings. Once
completed, the organizational consolidation is expected to generate
annual savings of at least $10
million.
LogistiCare will retain its name and continue to be
headquartered in Atlanta, GA. The
publicly-traded, legal entity, which owns LogistiCare, will
continue to be named The Providence Service Corporation and be
listed on NASDAQ under the ticker symbol PRSC. As part of the
organizational consolidation process, the Company's current
Stamford, CT headquarters and
Tucson, AZ satellite office will
be closed. Current Providence
employees will relocate to Atlanta
and become LogistiCare employees or fully transition their roles
and responsibilities to current or newly hired LogistiCare
employees in Atlanta.
The organizational consolidation process will be led by
Carter Pate, Interim Chief Executive
Officer. Effective today David
Shackelton will assume the newly created role of Chief
Transformation Officer, Bill
Severance will move from his current position as Chief
Accounting Officer to Interim Chief Financial Officer, and
Laurence Orton will move from his
current position as Corporate Controller and VP Finance to Interim
Chief Accounting Officer and SVP Finance. A search process for a
permanent Chief Financial Officer, based in Atlanta, has been launched.
"Today's announcement marks the realization of a detailed review
by the Providence Board of
Directors on how best to capitalize on the full growth and value
creation potential of LogistiCare," said Chris Shackelton, Chairman of the Providence Board of Directors. "The Board
review included a close examination of the Company's capital
allocation and acquisition strategy, as well as the deployment of
resources across the current holding company, LogistiCare, and
other subsidiaries. The Board determined that a consolidation of
the holding company infrastructure into LogistiCare creates an
organizational structure with strategic, operational and cultural
alignment, led by a single executive leadership team. We believe
these actions will drive shareholder value by sharpening our focus
on the significant growth opportunities available to our core
asset, LogistiCare."
Mr. Pate stated, "As we have recently discussed, Providence has been increasingly allocating
growth capital and strategic resources to LogistiCare. This
organizational consolidation reflects our view that the highest
returning opportunities will continue to reside within LogistiCare,
where we have been actively investing in numerous organic growth
and margin enhancement initiatives. We also anticipate that future
M&A efforts will be focused on opportunities that are adjacent,
complementary and synergistic to LogistiCare. Ultimately, the
consolidation of Providence under
a unified, streamlined organizational structure is a natural
evolution that will ensure more effective management and alignment
with our multiple value enhancement strategies."
Following completion of the organizational consolidation,
oversight responsibilities for the Company's Workforce Development
Services segment, which mainly operates under the Ingeus brand, as
well as the Company's investment in Matrix Medical Network, will
transition to the LogistiCare executive team.
About Providence
The
Providence Service Corporation owns subsidiaries and investments
primarily engaged in the provision of healthcare services in
the United States and workforce
development services internationally. For more information please
visit www.prscholdings.com.
About LogistiCare
LogistiCare, a wholly-owned
subsidiary of The Providence Service Corporation, is the nation's
largest manager of non-emergency medical transportation programs
for state governments and managed care organizations. Its range of
services includes call center management, network credentialing,
vendor payment management and non-emergency medical transport
network formation and management. In 2017, LogistiCare managed over
65 million trips for more than 24 million eligible riders. For more
information please visit www.logisticare.com.
Forward-Looking Statements
This press release contains
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Words such as "believe,"
"demonstrate," "expect," "estimate," "forecast," "anticipate,"
"should" and "likely" and similar expressions identify
forward-looking statements. In addition, statements that are not
historical should also be considered forward-looking statements.
Readers are cautioned not to place undue reliance on those
forward-looking statements, which speak only as of the date the
statement was made. Such forward-looking statements are based on
current expectations that involve a number of known and unknown
risks, uncertainties and other factors which may cause actual
events to be materially different from those expressed or implied
by such forward-looking statements. These factors include, but are
not limited to, our ability to successful implement and execute on
our organizational consolidation plan and other risks detailed in
Providence's flings with the
Securities and Exchange Commission, including its Annual Report on
Form 10-K. Providence is under no
obligation to (and expressly disclaims any such obligation to)
update any of the information in this press release if any
forward-looking statement later turns out to be inaccurate whether
as a result of new information, future events or otherwise.
Investor Relations Contact
Laurence Orton – Interim Chief Accounting
Officer and SVP Finance
(203) 307-2800
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SOURCE Providence Service Corporation