TUCSON, Ariz., Nov. 2, 2015 /PRNewswire/ -- The Providence
Service Corporation (Nasdaq: PRSC) today announced the completion
of its previously announced definitive agreement to sell all the
outstanding ownership interests of Providence Human Services, LLC
(PHS) and Providence Community Services, LLC (PCS), both wholly
owned subsidiaries of The Providence Service Corporation, to Molina
Healthcare, Inc. (NYSE: MOH). Consistent with terms
previously reported and prior to giving effect to working capital
and other customary closing adjustments, Molina paid $200 million to The Providence Service
Corporation upon closing.
The divested businesses generated revenue of approximately
$346 million in 2014 and $176 million in the first half of 2015.
Providence will use 50% of the net
cash proceeds from the transaction to prepay certain loans under
its existing credit facility. Subject to additional
management evaluation of market and business conditions, share
price and other factors and evaluation and approval by Providence's Board of Directors, the remaining
net proceeds of the transaction may be used for acquisitions,
investments in the long-term development of the Company's other
segments and the return of capital to stockholders through a share
buyback program, among other uses.
Moelis & Company LLC served as The Providence Service
Corporation's financial advisor and Paul Hastings LLP served as its
legal advisor.
About The Providence Service Corporation
The Providence Service Corporation provides and manages multiple
healthcare and social services, comprised of non-emergency
transportation services, workforce development services, legal
offender rehabilitation services, and health assessment services in
the United States and abroad. For
more information, please visit prscholdings.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 continuing
relationship with government entities and our ability to procure
business from them, our ability to manage growing and changing
operations, the implementation of the healthcare reform law, state
budget changes and legislation, statements with respect to
Providence's expected use of net
proceeds from the transaction and other risks detailed in
Providence's filings with the
Securities and Exchange Commission, including its Annual Report on
Form 10-K for the fiscal year ended December
31, 2014 and subsequent filings. 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.
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SOURCE The Providence Service Corporation