AHP Has New Home at Highland

DALLAS — Investment adviser Highland Capital Management,
which has $22 billion in assets under management, announced last
week it is now 100 percent owner of American Home Patient. The deal
is the culmination of a series of transactions, including a
self-tender of AHP’s common shares and a restructuring of its
senior debt of $216 million led by Highland that were completed on
Sept. 2.

After missing a repayment date in August 2009 and entering a
string of forbearance agreements with its debt holders, AHP
announced earlier this year it would go private in a move to avoid
bankruptcy. Founded in 1983, the Brentwood, Tenn.-based provider
operates in 33 states.

Under Highland’s ownership, AHP “will benefit from access to the
financial and strategic resources necessary to help the company
realize accelerated, profitable growth,” according to a Highland
release.

“Using a structured and proven approach to value creation,
Highland will partner with management to build a long-term
competitive advantage through differentiation in service quality
and operational excellence. The American HomePatient transaction is
a prime example of Highland’s distressed investment strategy,” the
release continued. “Highland has a distinct ability to identify
attractive investment opportunities designed to generate
above-average returns over time.”

According to Patrick Daugherty, head of private equity
investments at Highland, “We believe that American HomePatient is
well-positioned to benefit from the market changes caused by the
government’s competitive bidding program. The combination of the
American HomePatient organization, products and services with our
resources will enhance the company’s long term value and
success.”