HOUSTON, Nov. 16, 2017 /CNW/ -- Nobilis Health Corp. (NYSE
American: HLTH) ("Nobilis" or the "Company") today announced the
acquisition of a 50.1% ownership interest in Elite Surgical
Affiliates' ("Elite") portfolio of three ambulatory surgery centers
(ASCs) and one surgical hospital in the greater Houston area (the "Acquisition").
Key Highlights of the Acquisition
- A purchase price of approximately $60
million financed through an expansion of Nobilis' current
credit facility ($50 million), cash
($6.1 million), seller note
($3.5 million), and stock
($0.5 million).
- The acquired facilities' trailing twelve months revenue and
adjusted EBITDA for the period ended September 30, 2017, were $49.0 million and $30.3
million, respectively.
- Nobilis projects approximately $2
million of operating efficiencies resulting from the
consolidation of one Elite ASC with one existing Nobilis ASC
currently co-located at the same address.
- Nobilis expects increased productivity, lower staffing
requirements, and reduced operating costs over time as it leverages
its expanded platform of facilities.
- Following the Acquisition, Nobilis will have 13 locations (nine
surgical facilities and four clinics) in the Houston market. Ten of these locations will
operate under in-network contracts with all of the major commercial
payors.
Harry Fleming, Nobilis' CEO,
stated, "This acquisition represents a strategic opportunity to
enhance Nobilis' in-network revenue and adds 76 physician partners
to our existing network of surgeons in the Houston market. This transaction is
significantly larger than any of our previous acquistions and is a
major stride toward the Company's goal to derive most of its
revenue from in-network managed care contracts. Not only is this
transaction accretive to earnings, the expanded platform of
facilities and high-quality providers also enhances the Company's
ability to deliver outstanding, cost-effective healthcare to our
patients and communities."
Kenneth Efird, Nobilis'
President, stated, "We believe the acquisition and integration of
Elite will result in a series of benefits for the Nobilis system,
contained in four key areas: the ability to leverage best practices
from both companies and generate operational efficiencies, the
opportunity to improve conversion through the substantial increase
in referral-based business, the resources to expand marketing
services to physicians newly aligned with our system, and the
resources to further strengthen Nobilis' footprint within the
Houston market."
Expansion of Credit Facility
Nobilis funded the acquisition through a $50 million expansion of its existing credit
facility with BBVA continuing as lead arranger.
Additional Matters
JMP Securities, LLC served as financial advisor to Nobilis for
the Acquisition.
Dr. Donald L. Kramer retired from
the Nobilis Board of Directors. Harry
Fleming will take over as Chairman of the Board effective
today. He will maintain his CEO title and will serve in an
executive chairman capacity. "I want to thank Dr. Kramer on
behalf of the Board and the management team. He has built
strong fundamentals upon which we can continue to grow our
operations and increase shareholder value," said Harry Fleming.
About Nobilis Health Corp.
Nobilis (www.NobilisHealth.com) is a full-service healthcare
development and management company, with 31 locations across
Texas and Arizona, including 5 hospitals, 13 ASCs, and
13 multi-specialty clinics. In addition, Nobilis partners with an
additional 36 facilities across the country. Marketing nine
independent brands, Nobilis deploys a unique patient acquisition
strategy driven by proprietary, direct-to-consumer marketing
technology, focusing on a specified set of procedures that are
performed at its facilities by local physicians. Nobilis' business
model connects patients with physicians to deliver the highest
quality healthcare while enhancing physician practices within the
Nobilis network.
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of Canadian and United
States securities laws, including the safe harbor for
forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. Forward-looking statements include
all statements that do not relate solely to historical or current
facts and may be identified by the use of words such as "may,"
"believe," "will," "expect," "project," "estimate," "anticipate,"
"plan" or "continue." These forward-looking statements are based on
current plans and expectations and are subject to a number of
risks, uncertainties and other factors which could significantly
affect current plans and expectations and our future financial
condition and results. These factors, which could cause actual
results, performance and achievements to differ materially from
those anticipated, include, but are not limited to our ability to
successfully maintain effective internal controls over financial
reporting; our ability to implement our business strategy, manage
the growth in our business, and integrate acquired businesses; the
risk of litigation and investigations, and liability claims for
damages and other expenses not covered by insurance; the risk that
payments from third-party payers, including government healthcare
programs, may decrease or not increase as costs increase; adverse
developments affecting the medical practices of our physician
limited partners; our ability to maintain favorable relations with
our physician limited partners; our ability to grow revenues by
increasing case and procedure volume while maintaining
profitability at the Nobilis facilities; failure to timely or
accurately bill for services; our ability to compete for physician
partners, patients and strategic relationships; the risk of changes
in patient volume and patient mix; the risk that laws and
regulations that regulate payments for medical services made by
government healthcare programs could cause our revenues to
decrease; the risk that contracts are cancelled or not renewed or
that we are not able to enter into additional contracts under terms
that are acceptable to us; and the risk of potential decreases in
our reimbursement rates. The foregoing are significant factors we
think could cause our actual results to differ materially from
expected results. However, there could be additional factors
besides those listed herein that also could affect us in an adverse
manner.
We have not undertaken any obligation to publicly update or
revise any forward-looking statements. All of our forward-looking
statements speak only as of the date of the document in which they
are made or, if a date is specified, as of such date. Subject to
mandatory requirements of applicable law, we disclaim any
obligation or undertaking to provide any updates or revisions to
any forward-looking statement to reflect any change in our
expectations or any changes in events, conditions, circumstances or
information on which the forward-looking statement is based. All
subsequent written and oral forward-looking statements attributable
to us or persons acting on our behalf are expressly qualified in
their entirety by the foregoing factors and in our Annual Report on
Form 10-K for the fiscal year ended December
31, 2016, filed on March 14,
2017, as updated by other filings with the Securities and
Exchange Commission.
Contact Information:
Tuan Tran
Vice President, Investor Relations
(346) 207-6342
IR@Nobilishealth.com
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SOURCE Nobilis Health Corp.