Gentiva, Odyssey Deal Creates Largest U.S. Home Health, Hospice Provider

ATLANTA — Gentiva Health Services announced it has
entered a definitive agreement to acquire
Dallas-based hospice provider Odyssey HealthCare for approximately
$1 billion in an all-cash transaction.

The merger will create a hospice care provider with an average
daily patient census of 14,000 and operations in 30 states, and the
largest health care provider in the United States focused on home
health and hospice services. The combination will also create a
company with more than $1.8 billion in annual revenue, with 60
percent of that from home health and 40 percent from hospice
revenue.

Unanimously approved by both the board of directors at both
companies, the deal is expected to close in the third quarter and
is subject to standard closing conditions, including regulatory
approvals and clearance under the Hart-Scott-Rodin Act as well as
approval by Odyssey’s stockholders. Gentiva said it expects to
raise $1.1 billion in new debt financing to fund the purchase price
and refinance existing debt.

Following the February sale of its respiratory, HME
and infusion business to Lincare — which included about
40 locations in seven states — Gentiva said that moving
forward, the company would focus primarily on hospice and home
health services to seniors.

In March, the company acquired Mississippi-based Heart to Heart
Hospice, and announced last week it has completed acquisition of
the assets of United Home Care Group, a Medicare-certified home
health services business with six offices in the state of
Louisiana. Gentiva can now provide home health services to
approximately 85 percent of the state, the company said.

“We are delighted to welcome the Odyssey employees to the
Gentiva family,” Gentiva CEO and President Tony Strange said in a
release. “The combination of the two companies
clearly positions us as a leader in both home health and hospice
care in the United States. The two companies share similar
geography between Gentiva’s home health operations and Odyssey’s
hospice operations, with very little overlap between the two
companies’ hospice programs. “

Gentiva currently provides skilled nursing, physical,
occupational, speech and neurorehabilitation services, hospice,
social work, nutrition, disease management education and help with
daily living activities. The company reported net revenue of $297.1
million for the first quarter.